Lord Shepherd

Baroness Jay of Paddington: My Lords, before Questions, I am afraid that it is my duty to tell your Lordships that we have just heard the very sad news that my noble friend Lord Shepherd has died. I am sure that the whole House will join with me in sending sincere condolences and warmest sympathy to his family. Of course, as would be appropriate, we would all wish to pay tribute to my noble friend in the usual way. However, as we have only just heard the news, the Leader of the Opposition and I and the usual channels have agreed that perhaps tributes would be more appropriate on Monday. I hope the House will understand that. In the meantime we send our warm wishes to my noble friend's family.

Commonwealth Ministerial Action Group

Baroness Williams of Crosby: asked Her Majesty's Government:
	What progress has been made by the Commonwealth Ministerial Action Group in establishing the values and objectives for which the Commonwealth stands.

Baroness Scotland of Asthal: My Lords, the Commonwealth Ministerial Action Group was set up to deal with serious and persistent violations of fundamental Commonwealth principles. It is widely acknowledged to have advanced the values and objectives established in the Harare Declaration, in terms of promoting democracy, good governance, respect for human rights and the rule of law. CMAG engagement has been particularly effective in encouraging the restoration of constitutional democracy in cases where the legitimate government have been overthrown.

Baroness Williams of Crosby: My Lords, I thank the Minister for that reply. In the particular context of supporting democracy, was the Commonwealth Ministerial Action Group satisfied with the response of the Fijian Government to the actions that they took? Is it also satisfied with the proposals for a timetable for a return to elections in Pakistan, starting with local and provincial elections? Furthermore, given the commitment of the Commonwealth to a peaceful resolution of conflict, what is the present situation of the Commonwealth countries--in particular Zimbabwe and Uganda--currently involved in the Democratic Republic of the Congo conflict, with regard to their commitment to withdraw?

Baroness Scotland of Asthal: My Lords, the noble Baroness asked four questions. I shall deal with them in turn. In relation to Fiji, CMAG reacted decisively to the attempted coup and hostage-taking in May 2000. As noble Lords know, it suspended Fiji from the councils of the Commonwealth. Despite initial resistance from Fiji's un-elected regime, CMAG was instrumental in ensuring the appointment of a Commonwealth special envoy. The work of the envoy represented by a respected South African judge has done much. Last week at a meeting with John Battle, the Minister of State at the Foreign and Commonwealth Office, Fiji's caretaker Foreign Minister, Mr Tavola, welcomed the positive nature of CMAG's involvement in Fiji. So that was a positive outcome.
	As noble Lords will know, Pakistan is currently suspended from the councils of the Commonwealth in accordance with the rules laid down in the Millbrook Commonwealth Action Programme. Pakistan's Foreign Minister spoke to the Commonwealth Ministerial Action Group in September last year. Pakistan has since written twice to the Commonwealth Secretary-General, but we still have no firm date for national elections. Pakistan was discussed at the Commonwealth Ministerial Action Group on 19th and 20th. CMAG Ministers urged Pakistan to clarify its position before the October meeting of Commonwealth Heads of Government in Brisbane. If it does not do so, it risks further measures being taken at Brisbane up to and including expulsion from the Commonwealth. That is quite a serious position.
	The noble Baroness also asked about Zimbabwe's position in relation to the Congo and the withdrawal. I do not have a clear answer on that issue. I shall certainly write to the noble Baroness about that matter.

Lord Howell of Guildford: My Lords, given the latest illiberal set of dictatorial laws issued by President Mugabe, is it not now time that the values and objectives of the Commonwealth were asserted much more vigorously than they have been in the recent past? Since the Foreign Secretary has spoken about the importance of the Commonwealth, is it not time for Britain to take much more of an initiative in modernising and strengthening the Commonwealth's purposes? Finally, do the Government agree with the view of the Secretary-General of the Commonwealth that it does not necessarily follow that the Prince of Wales would be Head of the Commonwealth when the time comes?

Baroness Scotland of Asthal: My Lords, Her Majesty's Government have done much to support the values and objectives asserted by the Harare principles. Indeed, we have been very vigorous indeed. The noble Lord will know that it was a British initiative that led to setting up the high level group. It was the British voice which encouraged CMAG to take a more active part. Indeed, at the last CMAG meeting, it was decided that a mission comprising the Foreign Ministers of Barbados, Australia and Nigeria should be sent to Zimbabwe. That was a very clear signal indeed about the Commonwealth's concern. We await to hear what Mr Mugabwe said in response. But to describe the actions that we have been taking as anything less than vigorous is most misplaced. I am surprised that the noble Lord should so describe it.
	The choice as to who should be Head of the Commonwealth is a matter for discussion and decision among the 54 Commonwealth countries. But the British Government would expect the Prince of Wales, on the demise of the Crown, to become Head of the Commonwealth if that were the consensus.

Lord St John of Bletso: My Lords, does the Minister agree that, in the light of the Zimbabwe Foreign Minister's objection to CMAG's planned visit to Zimbabwe, the time has now come for CMAG's mandate to be reviewed to embrace ostensibly democratic countries that are using undemocratic means to stay in power? Here I refer specifically to Zimbabwe.

Baroness Scotland of Asthal: My Lords, noble Lords will know that we have for some time expressed concern about CMAG's mandate. It is currently being considered. CMAG drew up proposals for an expanded mandate, which was considered by the heads of government at their Durban CHOGM meeting. The heads have asked the high level group set up under the chairmanship of President Mbeki of South Africa to consider whether, and if so how, CMAG's mandate should be expanded. There has been a good deal of concern that CMAG's current mandate does not, for instance, include freedom of expression.

Lord Bruce of Donington: My Lords, the Question specifically refers to the Commonwealth Ministerial Action Group. Can my noble friend say on how many occasions over the past year the group, as a group, has met?

Baroness Scotland of Asthal: My Lords, I cannot give the noble Lord the exact number of occasions, but he should know that CMAG has concerned itself over a period of time with all those countries that have caused concern. It did sterling work in relation to Nigeria, Sierra Leone, Pakistan and Fiji, and now it is rightfully turning its attention to Zimbabwe. I undertake to provide the noble Lord with a specific answer in relation to the number of occasions on which the group has met, but I can reassure him that the group is active.

Lord Avebury: My Lords, did the Minister say that the high level group had agreed to recommend to the next CHOGM in Brisbane that the remit of CMAG should be extended to states where freedom of expression is under serious threat? Would freedom of expression in that context include religious intolerance, with particular regard to the situation in Pakistan, where the growing menace of sectarian violence threatens the return to democracy?

Baroness Scotland of Asthal: My Lords, I did not say that it had determined, but I did say that it had been charged with considering whether and how the mandate should be expanded. Once it has finished that consideration, it will be in a position to present its recommendations to the next CHOGM, where the whole of the Commonwealth will be able to consider whether it is minded to adopt those principles. We hope that there will be some movement.

Tourism

Lord Dormand of Easington: asked Her Majesty's Government:
	Whether they intend to increase government funding to the British tourism industry.

Lord McIntosh of Haringey: My Lords, the Government announced on 20th March a package of measures to alleviate immediate financial hardship of small businesses through rate reliefs, rescheduling tax and national insurance contribution payments and identifying sources of credit and other support. The Government are also considering funding to the English Tourism Council and the British Tourist Authority to lead programmes over the next few weeks to reinvigorate tourism in the English countryside and to boost the message abroad that Britain is open for business. An announcement can be expected tomorrow.

Lord Dormand of Easington: My Lords, I thank my noble friend for that helpful reply. Can he say how the grants that have been made to the tourist industry over the past four years compare with the present position, having regard to all the measures he has just mentioned? The two important grants to the British Tourist Authority and the English Tourism Council have been welcomed. But in view of the problems that still exist because of foot and mouth disease, is continuing consideration being given to increasing the grants? In addition, will not the proportion of rate relief to be borne by local authorities, which is 15 per cent and 25 per cent, present difficulties to the local authorities? Is that being re-examined?

Lord McIntosh of Haringey: My Lords, my noble friend asked about the funding of the British Tourist Authority and the English Tourism Council. The English Tourism Council will receive a grant of £10 million in the coming financial year, £12 million next year and £12.5 million in the year after. That is the basic funding. I referred also to an announcement that is to be made tomorrow. On the question of local authority expenditure, it is proposed that local authorities will have 95 per cent of their costs of operating the rate relief refunded by central government.

Lord Roberts of Conwy: My Lords, is the Minister aware that what his noble friend Lord Dormand said is quite correct? For businesses that have a rateable value of more than £12,000 per annum, 25 per cent of the rate relief will have to be borne by the local authorities, which are already under pressure as a result of a reduction in their revenues as a consequence of the foot and mouth epidemic.

Lord McIntosh of Haringey: My Lords, both noble Lords are correct about the figures. If this appears to cause hardship, it is one of the many matters which the Rural Task Force is willing to consider again in its ongoing deliberations on what needs to be done. But I can say that the reduction of the business rate took place on 1st April and our helplines show that it is much appreciated.

Lord Harrison: My Lords, will my noble friend accept the plaudits of both the travel and tourism industries for the halving this week under the Budget of the airport passenger departure tax, which in itself was an inhibition to encouraging tourists to come to the United Kingdom? Can the Government now go one step further and eliminate this Tory stealth tax?

Lord McIntosh of Haringey: My Lords, on behalf of the Chancellor of the Exchequer, I am happy to accept the plaudits mentioned by my noble friend. However, I am not prepared to predict any further changes in government taxation policy.

Baroness Byford: My Lords, has the Government's task force, which met yesterday, considered the possibility of making available loans to businesses? While the moves already made by the Government are helpful, many small businesses in the sector are going broke. They need immediate loans to keep going, not merely tax breaks.

Lord McIntosh of Haringey: My Lords, the report of the work of the task force made to Parliament on 20th March made clear that we were in touch with banks and leading financial institutions, encouraging them to relax their rules on loans. I agree with the noble Baroness, Lady Byford, that this is enormously important.

Viscount Falkland: My Lords, following on from the question put by the noble Baroness, Lady Byford, is it not the case that the current outbreak of foot and mouth disease merely serves to compound in many areas of our tourist industry a problem which already existed? Small businesses operating in seasonal areas are more and more feeling the pinch, in particular those in our seaside resorts. Aside from the funding and other measures that the noble Lord has outlined, does he agree that, over the medium and long-term, we are going to have to look at the whole strategy of funding tourism in this country and to think about where that funding should be aimed?

Lord McIntosh of Haringey: My Lords, I do not think that I accept the case put by the noble Viscount, Lord Falkland; namely, that tourism was suffering before the foot and mouth outbreak. In fact, our tourism figures both for visitors from within this country and for those from overseas continued to be buoyant throughout the year 2000, despite the strong pound. Nevertheless, the matters referred to by the noble Viscount will continue to be considered.

Baroness Oppenheim-Barnes: My Lords, will the noble Lord accept that tourism was a wonderful and successful industry that did not look for handouts until the present tragedy struck? I say that as someone who once held some ministerial responsibility for tourism. In those days, tourism was our fourth largest invisible export. Can the noble Lord tell the House what position it holds now?

Lord McIntosh of Haringey: My Lords, certainly I accept that the tourist industry has not been looking for handouts. What it has been seeking--as it did when the noble Baroness, Lady Oppenheim-Barnes, was a responsible Minister--is assistance with marketing. That is still the case. Indeed, a great deal still needs to be done to improve the marketing of our wonderful and very valuable tourist industry.
	I am not sure whether anything has changed as regards tourism holding fourth place in terms of invisible exports, but I shall write to the noble Baroness on the matter.

Lord Watson of Richmond: My Lords, can the noble Lord explain the discrepancy in the level of resources provided for the promotion of tourism in Scotland and that available in some of the English regions? I am thinking in particular of the north-east of England. I understand that Scotland spends around 40 times more on the promotion of tourism than does that part of England.

Lord McIntosh of Haringey: My Lords, in this House we are not responsible for how much the Scottish Executive elects to spend on tourism. However, the noble Lord, Lord Watson, will be pleased to know that, on 28th March, the Scottish Executive announced a package very similar to that which was announced in this House on 20th March. As regards the funding of the Northumbria Tourist Board, to which I believe the noble Lord referred, I am sure that he will recognise that that tourist board is an extremely lively, active and successful organisation.

Secondary School Class Sizes

Lord Pilkington of Oxenford: asked Her Majesty's Government:
	What is their response to recent figures from local education authorities revealing that in many areas secondary school class sizes are at their highest for 10 years.

Baroness Blackstone: My Lords, new figures for the average class size in secondary schools will be published tomorrow. In January 2000, the average size of a secondary class was 22. That is, on average, around five fewer pupils than in primary school classes. Increases in the average size of secondary school class sizes are not new. The average secondary class size rose by 1.4 between 1991 and 1997 and has risen by only 0.3 between 1997 and 2000. Some 193,000 secondary school teachers were employed in schools in England in January 2000, which was 3,800 more than in 1997.

Lord Pilkington of Oxenford: My Lords, I thank the Minister for that reply. Does she share the concerns expressed by many schools and reported in the press that the changes in A and AS-levels have resulted in more subjects being taken? That has led to larger sets for A-level teaching, in one case of some 20 pupils, which the noble Baroness will know is far too many? Furthermore, is the noble Baroness aware that there is a shortage of teachers in many specialist subjects, in particular the scarce subjects such as physics and mathematics? Will the noble Baroness be able to issue advice to schools as to how to cope with this problem?

Baroness Blackstone: My Lords, I believe that the changes which have been made to the sixth form curriculum have been widely welcomed by schools, teachers, employers, parents and, indeed, by students themselves. I should point out that, prior to those changes, many sixth-form classes were extremely small. They were far smaller than classes lower down in the school, reflecting the fact that not all pupils stay on at school to take A and AS-levels, as well as GNVQs. For that reason, I do not believe that there is any evidence of a serious deterioration in sixth form class sizes. Some classes may be a little larger, but I do not believe that that slight increase would in any way affect the quality of teaching offered in sixth forms.

Baroness Walmsley: My Lords, is the Minister aware that, in his last annual report, the Chief Inspector of Schools reported that the percentage of schools in which the teaching of science, maths and modern languages was unsatisfactory had doubled at key stage 3 when compared to the figures for the previous year? The figures for key stage 4 were almost as bad. Does the Minister think that large class sizes, along with the shortage of specialist teachers, might have something to do with those findings?

Baroness Blackstone: My Lords, of course it is extremely important to tackle the shortage of specialist teachers. That is exactly what the Government are doing. As the noble Baroness, Lady Walmsley, knows, the Government have introduced a training salary for potential teachers undertaking their PGCE courses, as well as offering golden hellos for those teachers who will work in disciplines where there are shortages. As a result, we have already seen a substantial increase in the numbers of young people applying to train for teaching. The application rate for PGCE courses has risen by 24 per cent, with particularly large increases in applications for those specialist subjects mentioned by the noble Baroness. Most science teaching is now being undertaken in our secondary schools by teachers who are qualified in science; that is as it should be.

Lord Puttnam: My Lords, does my noble friend agree that, if we are to have a mature debate on the development of secondary education, we shall have to navigate our way past the simplistic notion that class size is the fundamental criterion here? Any number of other factors need to be taken into consideration. Over the past three years I have spoken to literally hundreds of teachers. The overwhelming response from them has been that, given a straight choice between taking larger classes with the support of classroom assistants or being left on their own to teach smaller classes, they would always prefer the support component. What progress have the Government made as regards recruitment levels for teaching support?

Baroness Blackstone: My Lords, I entirely agree with my noble friend when he stated that many factors determine the performance of pupils in our schools. Class size is only one of those factors. It is wrong to become too hung up as regards whether there are only 21 children in a secondary school class or whether there are 22. I think that it was right for the Government to place particular emphasis on reducing class sizes in infant schools because all the research demonstrated that very young children do benefit from being taught in smaller classes.
	To return to my noble friend's points about secondary schools, over the past couple of years we have increased the number of teaching assistants working in secondary schools by some 3,000. I think that the adult/pupil ratio is as important as the teacher/pupil ratio. Many teachers have said that they want us to provide such extra support in the classroom in order to free them to attend to their specialist tasks.

Baroness Blatch: My Lords, does the Minister agree that the pupil/teacher ratio is not necessarily a guide to how many children there are in a class? While I agree with the noble Lord, Lord Puttnam, that there is a more mature debate to be had, it was the Government who chose smaller classes as their target when they came to office. Does the noble Baroness further agree that the department's own figures as of April last year, after three years in office, show that the number of children in classes of 31 and more had increased and that the number of children in classes of 36 or more had increased by 50 per cent? After listening to governors and teachers, there is no reason to believe that the situation has improved after four years in office.

Baroness Blackstone: My Lords, I am not sure what the noble Baroness's reference to pupil/teacher ratios was about. Of course pupil/teacher ratios are different to class sizes. The pupil/teacher ratio in secondary schools is approximately 17.2 pupils to every one teacher. As I have said, it was right for the Government to focus on class sizes so far as concerns infant school children because the previous government, of which the noble Baroness was a member, left literally hundreds of thousands of infant school children in classes of more than 30. The Government have now virtually achieved their pledge; some 98 per cent of infant school children are in classes of less than 30. There are also fewer pupils among the older age group in classes of more than 30 in primary schools and, indeed, in secondary schools. I simply do not recognise the noble Baroness's figures.

Royal Ulster Constabulary

Lord Glentoran: asked Her Majesty's Government:
	What plans they have for the replacement of the Royal Ulster Constabulary officers of superintendent rank and above who are leaving the force within the next 18 months.

Lord Falconer of Thoroton: My Lords, replacement of officers of superintendent and assistant chief constable rank are matters for the Chief Constable and the Police Authority for Northern Ireland respectively. All sides welcome the Government's generous severance terms for the RUC. The offer has been taken up by 54 officers of superintendent rank or above during the period January to March 2001. A further 42 officers of these ranks are expected to avail themselves of the offer in the next year. The introduction of district command units by the Chief Constable has reduced the need for superintendent ranks by 34, and his review of the headquarters structure is expected to lead to a further reduction in the number of officers of this rank. However, the Chief Constable intends to hold assessments to create a pool of successful candidates from which vacancies arising for superintendents can be filled.

Lord Glentoran: My Lords, I thank the noble and learned Lord for that Answer. Does he not agree that the pace of restructuring of the Northern Ireland police force in order to meet the Patten requirements should take account of the lack of decommissioning and the serious increase in organised crime? Will the Minister assure the House that Her Majesty's Government will take whatever action is necessary to maintain a police force with the necessary skills, experience and resources to police Northern Ireland, with all its particular difficulties?

Lord Falconer of Thoroton: My Lords, I unhesitatingly give the assurance that the Government will take no chances with security and will continue to protect the people of Northern Ireland. The Government do not believe that the need to protect against the dissident terrorist threat is a reason not to modernise the police service. In all matters such as this, the Government will take the advice of the Chief Constable. He has made clear in recent remarks that he believes that the police service can certainly cope with the current challenges, in particular the challenges brought about by the changes involved in implementing the Patten recommendations.

Lord Mackenzie of Framwellgate: My Lords, does my noble and learned friend agree that a certain amount of command resilience is absolutely essential in the police service because of unexpected and sudden demands? Will he join me in paying tribute to the thousands of officers who have served in the RUC throughout their working lives--and, in many cases, given their lives--in the service of all communities in Northern Ireland?

Lord Falconer of Thoroton: My Lords, I unhesitatingly associate myself with my noble friend's remarks. I also agree that command resilience is incredibly important. I am quite certain that the Chief Constable will ensure that that exists.

Lord Molyneaux of Killead: My Lords, in view of the alarming domination of the civil power by drug baron paramilitaries, will the Government keep in mind the possibility--and perhaps the necessity--of increasing Army strength to prevent a complete breakdown of order?

Lord Falconer of Thoroton: My Lords, I have repeatedly said that the Government will take no chances with security. They will continue to be advised by the Chief Constable and the Army in relation to that.

Lord Smith of Clifton: My Lords, will the noble and learned Lord reassure the House that the Chief Constable, Sir Ronnie Flanagan, will permit senior staff to take early retirement only if it is consistent with the management needs of the RUC?

Lord Falconer of Thoroton: My Lords, the Chief Constable, among others, has welcomed the generous increased severance package that has been on offer for the past few months. He will, of course, ensure that the numbers remain consistent with security requirements.

Lord Burnham: My Lords, what percentage of the middle and senior ranks of the RUC will have left the force by March 2002?

Lord Falconer of Thoroton: My Lords, on 31st March 1999, there were 170 officers of superintendent rank and above; on 31st March 2000, there were 172; at the moment there are 130, which means a reduction of 40 between the 31st March 1999 and the 31st March 2001. A further 42 officers of that rank and above are expected to leave by 31st March 2002, but a number of those who retire will be replaced by people who will be promoted.

Lord Dubs: My Lords, will my noble and learned friend say a little more about the RUC's recent successful recruitment campaign?

Lord Falconer of Thoroton: My Lords, in the past few months, the RUC has embarked on a recruitment campaign. There were in excess of 240 applicants, and choices in relation to that will be made in the next few months.

Business of the House: Standing Order 46

Baroness Jay of Paddington: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	Moved, That Standing Order 46 (No two stages of a Bill to be taken on one day) be dispensed with today to enable the First and Second Readings of the Elections Bill to be taken and on Monday 9th April to enable the remaining stages of the Bill to be taken.--(Baroness Jay of Paddington.)

On Question, Motion agreed to.

Select Committees

Lord Tordoff: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	Moved, That the Lord Brabazon of Tara, Principal Deputy Chairman of Committees, be appointed Chairman of the European Union Committee in the place of the Lord Tordoff and a member of the House of Lords' Offices Committee and the Procedure of the House Committee.--(The Chairman of Committees.)

On Question, Motion agreed to.

Commonhold and Leasehold Reform Bill [H.L.]

Lord Irvine of Lairg: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	Moved, That the amendments for the Report stage be marshalled and considered in the following order:
	Clauses 1 and 2,
	Schedule 1,
	Clauses 3 and 4,
	Schedule 2,
	Clauses 5 to 33,
	Schedule 3,
	Clauses 34 to 56,
	Schedule 4,
	Clauses 57 to 65,
	Schedule 5,
	Clauses 66 to 69,
	Schedule 6,
	Clauses 70 to 99,
	Schedule 7,
	Clauses 100 to 120,
	Schedule 8,
	Clauses 121 to 138,
	Schedule 9,
	Clauses 139 to 141,
	Schedule 10,
	Clauses 142 to 148,
	Schedule 11,
	Clauses 149 and 150,
	Schedule 12,
	Clauses 151 to 154,
	Schedule 13,
	Clauses 155 to 157.--(The Lord Chancellor.)

On Question, Motion agreed to.

Elections Bill

Brought from the Commons and on 4th April and printed pursuant to Standing Order 50, and read a first time.
	Then, Standing Order 46 having been dispensed with (pursuant to Resolution of today).

Lord Bassam of Brighton: My Lords, I beg to move that this Bill be now read a second time. Before I come to the substance of my opening speech, I should perhaps point out that one of the earlier editions of the speakers' list circulated today suggested that I would be responding to the debate for the Government. I am happy to advise the House that my noble and learned friend Lord Williams of Mostyn will be responding for the Government on this important Bill.
	The purpose of the Bill is simple to understand. On 3rd May, local elections were due to have taken place in 34 English county councils and in 11 unitary authorities. Just under two weeks later, on Wednesday, 16th May, elections were due to have taken place in all 26 district councils in Northern Ireland. The Bill would postpone all of those elections to 7th June 2001, together with any by-elections to fill casual vacancies that would otherwise have taken place in the period 3rd May to 6th June.
	I shall say a little more about the detailed provisions in the Bill in a moment, but it may be helpful to your Lordships if I were first to explain why we have decided to bring it forward. I am conscious that my noble friend the Leader of the House outlined some of our thinking on Monday when she repeated a Statement which had been made in the other place by my right honourable friend the Home Secretary, so I hope that I can be relatively brief.
	The decision to postpone local elections is not one that we in government have taken lightly. As someone who, along with many of your Lordships, has a background in local government, I am acutely conscious of the importance of local elections. They are, after all, the means by which local people hold those who govern in their name to account. Nevertheless, the Government have received very strong representations that the local elections should be postponed as a consequence of the outbreak of foot and mouth disease; and we have paid very close attention to those representations.
	As my noble friend said on Monday, our judgment was that, from a purely practical and administrative point of view, the elections could have gone ahead as scheduled. The buildings in which polling stations are located are, almost without exception, accessible by the public highway, which remains open; indeed, it is the case that, with only a tiny handful of exceptions, schools and libraries and other public buildings have remained open during the crisis, even in the worst affected areas.
	Having said that, there is a world of difference between it being possible to run elections and it being desirable to do so. Both central and local government are devoting massive efforts and resources to seeking to combat and eradicate foot and mouth disease. It is quite clear that holding local elections in the middle of this work would be a distraction which would serve no useful purpose in the long-term battle to get on top of this outbreak.
	We have also paid very close attention to the representations of those who have been most directly affected by foot and mouth disease. They have made it abundantly clear that they would consider it both unnecessary and insensitive to hold local elections next month. Accordingly, we have come to the view that, on balance, the national interest would best be served by deferring the elections that are due to be held next month.
	Let me therefore explain to your Lordships why we have decided that the elections should be postponed for approximately a month, until 7th June.
	I am not going to pretend to your Lordships that foot and mouth disease will be completely eradicated in a month's time. The experience of the outbreak in 1967 suggests that it will be many months before this country is completely free of foot and month disease. It is the case, however, that the next month will be crucial in our efforts to get on top of the outbreak. We need to ensure that we have proper mechanisms in place that enable us to deal with suspected cases instantly and ensure that the time between diagnosis of a case and slaughter of the animals affected is as short as possible. I hope that in the next month it may be possible to say that some of the areas which have had confirmed cases of foot and month disease are now free of it.
	There is also another important consideration. We cannot ignore the needs of the tourism industry. It is a striking fact that for every 1 per cent of gross domestic product that comes from agriculture, 7 per cent of our GDP is generated by tourism. The tourist industry is rightly very concerned about the impact that foot and mouth disease is having both on domestic tourism and, more particularly, on tourism from overseas.
	If we were to postpone the local elections indefinitely, as I believe the Official Opposition have suggested, the signal that we should be sending to the rest of the world is that Britain is in a terrible state and that we have no idea when things will get better. By setting a fixed date when these elections will take place, we are showing the rest of the world that we believe that within a month we shall have in place the mechanisms to ensure the eventual eradication of this disease and that Britain is open and ready to receive visitors for the all-important summer season. Noble Lords may be interested to hear what Malcolm Bell, of South West Tourism, said when the announcement was made on Monday. His words were:
	"This is a positive announcement. There's confusion at the moment about whether or not the country is open. Delaying the election until June sends out a clear message that, before the summer holidays begin, Britain is back to normal".
	I should add, as many noble Lords recognised in the exchanges following the Statement repeated by my noble friend on Monday, there needs to be certainty. Local authorities, councillors, candidates and those who interact with local authorities need to be clear as to when the deferred elections will take place.
	Having explained why we have brought the Bill forward, perhaps I may briefly explain its provisions. Clause 1, which applies to England and Wales, has the effect of postponing the ordinary local elections that were due to take place on 3rd May 2001 until 7th June 2001. It also, as I have indicated, provides that any local government by-elections to fill casual vacancies that would have been held within the period of the deferral will also take place on 7th June.
	There are also a number of consequential provisions. The clause provides that candidates who were validly nominated before the nominations closed for the elections on 3rd April, two days ago, will remain validly nominated for the new elections without the need to submit fresh nomination papers.
	However, candidates will have until 15th May to withdraw their nomination papers if they do not wish to contest the elections on the new date, and it will be possible for anyone else to submit nomination papers by 10th May. These dates are calculated, with reference to 7th June, using the normal local election timetable. For the sake of completeness, I should say that the closing date for postal vote applications will be 5 p.m. on Wednesday 30th May.
	We recognise that even though, as I have just said, nominations for these elections only closed on Tuesday, after it had been announced that they would be postponed, some candidates may have already printed their leaflets. It is possible that some of these may be redundant: if, for example, they said something like "Vote Bassam on 3rd May"--it has never happened before, but one never knows. In recognition of this and of the fact that the campaign period will inevitably be longer than normal for the elections on 7th June, the election expenses limit for each candidate is raised by 50 per cent.
	Clause 2 makes similar provisions in respect of the district council elections that were due to take place in Northern Ireland on 16th May. These, too, are moved to 7th June.
	Much of the rest of the Bill, including the schedule, relates to Northern Ireland. The purpose of these provisions is to provide that if the general election and local elections fall on the same day, the polls in Northern Ireland can be combined, as they are on the mainland. Let me hasten to say to your Lordships that I am making no statement or prediction about the likely date of the general election. That is a matter for my right honourable friend the Prime Minister.
	Section 15 of the Representation of the People Act 1985 provides that, where local and parliamentary elections fall on the same day, the polls can be combined. That is to say, voters can attend the same polling place and use the same polling station to cast their vote for two or more elections at the same time. That provision was never extended to Northern Ireland. The reason for that is that Northern Ireland uses the single transferable vote electoral system in local government elections and it was thought that it might be too confusing if polls were combined when different electoral systems were in use.
	However, we have had recent experience in Scotland and Wales of combined polls, where two or more electoral systems were in use and it is evident that it has not caused undue confusion to the electorate; nor have we seen a significant increase in the number of spoilt ballot papers. That being the case, there seems no reason why polls should not be combined in Northern Ireland, should the two elections fall on the same day, and we are therefore taking this useful opportunity to provide for that.
	Detailed consequential changes to the parliamentary and local election rules are required. These are what the schedule contains. However, I can assure your Lordships that they simply mirror provisions already in force in Great Britain. Where they do not, it is as a result of consultations with electoral administrators.
	I now turn to Clause 6. We recognise that local authorities, which are responsible for meeting the costs of local elections, will inevitably have incurred expenditure in preparing for elections on 3rd May and possibly, to a lesser extent, for elections on 16th May. They will also be obliged to go on incurring expenditure--for example, on printing ballot papers--until this legislation receives Royal Assent, which is why we are keen that it should reach the statute book with all due speed. We are very grateful for your Lordships' co-operation in that regard.
	Clause 6 provides that the Secretary of State can set up a scheme to compensate local authorities for the additional expenditure they have incurred as a result of the deferral of the elections.
	The clause also gives the Secretary of State the power to establish a scheme to compensate candidates for wasted expenditure. In another place yesterday, my right honourable friend the Home Secretary said--with the approval, I believe, of all parts of the House--that he did not believe it would be right to compensate candidates of registered political parties; however, the case of independent candidates who have suffered genuine and significant financial loss as a consequence of the deferral of the elections was rather different. He said that he would be prepared to consider claims from such people sympathetically.
	I have outlined briefly the purpose of the Bill for your Lordships. As I indicated at the beginning of my remarks, in deciding to bring it forward we had to balance many competing interests and factors. Our conclusion was that it would not be appropriate to hold elections next month, but that all concerned--local authorities, candidates and those who deal with local authorities--need the certainty of knowing when the deferred elections will take place. That is what this Bill gives them.

Lord Renton: My Lords, can the Minister please amplify one statement that he made about the contribution of tourism to our gross domestic product? He said that domestic tourism provides some of that contribution, while foreign tourism provides the rest. Can the noble Lord tell the House how much each of those produces towards the 7 per cent figure?

Lord Bassam of Brighton: My Lords, I should very much have liked advance notice of such a question. Obviously it is a matter of importance. In everything that we say and do, we need to ensure that we continue to promote the view abroad that we are very much open for business. Clearly, much of our tourism depends on people travelling to our country. I shall endeavour to undertake some research in this respect and provide the noble Lord with as good a response as I can on the balance of tourism. I quite understand the noble Lord's point. In the meantime, I commend the Bill to your Lordships. I beg to move.
	Moved, That the Bill be now read a second time.--(Lord Bassam of Brighton.)

Lord Cope of Berkeley: My Lords, we are all grateful to the Minister for moving the Bill. We were also glad to hear that, despite what the speakers' list says, the noble and learned Lord, Lord Williams of Mostyn, will conclude the debate. It is pleasing to be given such notice, if only in a public way.
	The origins of this Bill must be as extraordinary as those of any Bill ever presented to Parliament, stemming from the Prime Minister's repetition to the media in Downing Street on Monday of part of what his spin doctors told the media on Friday; namely, that the general election and the council elections for 3rd May were to be postponed for approximately a month.
	The Prime Minister asked us to believe two impossible things. The first impossible thing was that his announcement was all about the council elections. No one believes that the Prime Minister would bother to invite the media and make a great public statement to them in Downing Street solely about the council elections. This is the only Bill--certainly, one of so modest a size--I can think of which has warranted a personal press conference by the Prime Minister, particularly as he was unaccompanied by the relevant departmental Ministers. The fact that he stood alone gave away that he made it because he was also postponing the plans he had for the general election. As a matter of fact, he would not have needed to make an implied announcement about the general election if he and his people had not built up the idea that the general election was to be on 3rd May in the first place. As we all know perfectly well, it does not need to be held until next year.
	The second impossible thing the Prime Minister asked us to believe is that although there is in his, and in the Government's, view apparently no practical reason for doing so, the 3rd May elections are being postponed for a month out of concern for the sensitivities of farmers, and others, in rural areas. But, of course, that concern is strictly temporary and time limited. Whatever happens to the foot and mouth epidemic, we are told that the elections will go ahead on 7th June. There are two things wrong about that. First, there are practical reasons why the elections, especially council elections in some parts of the country, are difficult to hold, and, secondly, no one--not even the Prime Minister--knows what the position will be at that time as far as concerns the foot and mouth epidemic. Where there are two impossible things to believe, it seems to me to be worthy of a new Lewis Carroll; I suggest, "Alastair in Wonderland".
	We all know that the Prime Minister, for very good reason, got scared about the effects of the foot and mouth crisis on his planned early election, and that he dare not risk waiting until October. I, for one, wish that we could be spared this nauseating stuff about Tony thinking about the whole country. For the past four years, No. 10 has been a ruthless nest of political manipulators, constantly tweaking the tiller in response to every puff of the political wind in order to control both internal Labour politics and its national image. Incidentally, the Liberal Democrats fall for it about every other week.
	However, there would have been no general election problem or uncertainty--and, for example, no damage to tourism--if the Prime Minister had not driven so hard to build up expectations of an early election. The general election has not been postponed; but it will not be held early, or not as early as we had been led to believe. The council elections, perhaps only in the worst hit areas, could readily have been postponed without any international repercussions. By trying to hang on to his plan to go early, he has increased the damage to the tourist industry and extended the problems.
	As we had a full debate on the subject yesterday, there no need for me to say much about foot and mouth. But, like most of us, I feel dreadful about those affected. A friend of mine in Cumberland has told me about an outbreak on a nearby farm, which finished lambing--in all weathers--late on Saturday night. They killed the lot, both ewes and lambs, on Tuesday. Worse still for me, there is a group of cases in Berkeley, just outside the town. The farms are devastated. Businesses of all kinds are on the floor; and the awful stench of burning drifts over it all. So it is right not to hold the general election a year early in the midst of the crisis. It is right to postpone the council elections. But to spin first one way and then another has multiplied the damage, and we are left with this emergency Bill.
	It may have an odd origin, but it is a Bill of some constitutional significance. In this country we allow the Prime Minister of the day to initiate an early general election, but we have fixed dates for local elections that should not be lightly or easily moved. We have no entrenched constitution which would, in most countries, govern such things, so an ordinary Bill--or, as in this case, a half-debated, rushed Bill--can vary the constitution. I very much regret the guillotine motion in another place that denied this Bill, like others, proper scrutiny. But it happened, and it places an extra responsibility on your Lordships' House.
	We have amendments that we will wish to propose on some of the provisions. I shall not refer to all of them today, but one is of particular importance. It would give the Secretary of State power by order, subject to affirmative procedure in both Houses, to deal with the situation should the foot and mouth epidemic remain out of control when it comes to the council elections on 7th June. If it is right--as it is--to postpone the local elections now because of foot and mouth, it may still be right in May. It is simply not logical to bash ahead regardless.
	If the worst happens, our suggestion is that either individual by-elections or whole local areas may need further respite. In the amendment, we shall provide for objective tests of the progress in halting the foot and mouth epidemic to ensure that the delaying powers can only be invoked for that reason. Of course we all hope that they will not be necessary, but June is not far off and obviously the election process would have to start some weeks before that. The epidemic is still powerful and unpredictable, as we all know. In some areas farmers are candidates for council elections. They are sometimes long-standing councillors. How can they campaign in these circumstances? Can everyone in the most severely affected areas get a postal vote form and return it when they are stuck on the farms where they live? Those are some of the practical problems of holding local elections in the present situation, or anything like it. In my judgment it is simply not true to assert that there are no practical problems. There are.
	The Minister rightly drew attention to the Northern Ireland provisions of the Bill. They bring their own complications and take up the bulk of the Bill. Those of us who follow matters in the Province wish to study the details but there is also an interesting corollary. As was said, the Northern Ireland local elections were due on 16th May, but they are to be moved to 7th June. Virtually all the complications in the Bill arise from the requirement to enable the general election to be held on the same day as the local elections; that is to say, on 7th June. That is the clearest signal that the general election is to be held on 7th June in spite of the Minister's attempts to fudge it.
	Like all of us, I hate the reasons for this Bill's introduction. I regret the way that all this has been thrust upon us and the councils by the Government's delay, but overall it is right to postpone the council elections.

Baroness Hamwee: My Lords, as many noble Lords said on Monday, it is dangerous to delay any election. It is worth emphasising that point. However, in the present circumstances the case is arguable and the arguments are pretty finely balanced.
	Two or three weeks ago I discussed the date of the general election with my noble friend Lord Shutt of Greetland. He said that it would be unseemly to hold a general election in view of the current problems with foot and mouth in the countryside and its effects on the tourism industry. For that reason I support the proposal in the Bill. As the noble Lord, Lord Cope of Berkeley, said--I understand the reasons for the Government not being able to admit to this--we are discussing the Bill against the backdrop of the likely concurrence of the general election with the council elections. I find it difficult, if not impossible, to maintain the fiction that the general election date is irrelevant to that. The perhaps unworthy thought has also crossed my mind that the Government would prefer not to have the council elections before the general election as the results might not be those they would wish.
	However, as I say, we shall not impede the Bill. A major factor in my mind is the general public view that, "You politicians are only in it for yourselves". My response is often, "Yes, we are in it for all the footslogging and the lost sleep" although, admittedly, we are also in it for the buzz, the excitement and even sometimes for the sense of doing something worthwhile. However, that general public perception and the lack of engagement of the general public with what we, as serious politicians, attempt to do for our country are of the utmost concern. If we do not recognise the way that those outside the hothouse of Westminster perceive the manner in which decisions are taken, we would be most insensitive to what is in the public mind.
	The tight timetable of the legislation perhaps only reinforces the public perception of the introspection of Parliament. I am glad that this House has two days to consider the Bill. It is a matter for another place how it deals with its time but I suppose it was inevitable that it spent longer on the guillotine Motion than on the Second Reading of the Bill yesterday.
	However, we could not support any proposal to make the postponement of the local elections open-ended. That would give far too much power to politicians. Whether or not the Conservatives wish to keep their heads in the sand over when the election will take place is not perhaps a matter for debate today. We shall debate on Monday the amendment flagged up by the noble Lord, Lord Cope of Berkeley. However, we are doubtful that it is possible to apply the objective tests which he mentioned. We would be very much against a patchwork of elections taking place in some areas but not in others.
	I am concerned that the provisions of Clause 7 might allow the Secretary of State to change the date of 7th June by order. We shall table an amendment to seek absolute clarity that the provisions for statutory instruments do not extend to a change of the date which is at the heart of the Bill. As has been said--it is quite clear from the comparative length of the contents of the Bill--the Northern Ireland provisions had been drawn up before the rather short provisions on the change of date of the elections in England and Wales. One can speculate as to whether the provisions were waiting in someone's out tray to be used on another occasion.
	Obviously, there are pressures on parliamentary draftsmen. However, if the provisions to implement the change in England and Wales, including the orders to be made, need in total to be as long as those for Northern Ireland and are to be made by order subject to negative resolution, that is not satisfactory. We have already seen an example of the confusion and the difficulty in which officials inevitably find themselves. A circular from the Home Office--which, in these wondrous days of e-mail, appeared on my computer this morning--commences as follows:
	"Some of you have noticed that one of the dates given in circular 439 is wrong".
	Such an error is not surprising, given the speed with which the process has been carried out, but it is a pity that we have not been a little more competent.
	I believe that Clause 7, which provides for transitional, consequential or supplemental provision, might include the scheme for compensation which is the subject of Clause 6. We are most concerned about how a compensation scheme would be calculated and approved. It should be subject to some kind of scrutiny. We support compensation for local authorities which will have incurred the expenses of a partly aborted process for the May elections and may, in some cases, face the expense of finding a new polling station where, for example, examinations are being held in schools on the relevant date. However, we do not support compensation for candidates. That is a matter on which we shall table an amendment.
	The Minister confirmed what the Secretary of State said in another place yesterday; namely, that he would regard it as inappropriate for candidates of registered political parties to be compensated from the public purse. I am not sure whether we have heard that stated in the form of an undertaking that the Government will not put forward a scheme providing for that. It would be helpful if the Minister replying to the debate could give that undertaking.
	The Home Secretary said that he wanted to keep open the option of compensation for farmers who intend to stand as independent candidates and bear their own costs. Because I come from a rather impecunious party, many of the candidates whom I know bear most of their own costs. I do not believe that the point is particularly relevant and I am not immediately persuaded that it would be appropriate.
	The issue of compensation for those who work in the countryside and are affected by foot and mouth disease, both directly and indirectly, is a large one. I do not believe that it is the way in which to begin to address the matter. It is an irrelevant point and it would be wrong for compensation for individuals to come out of the public pocket. If the Government are insistent on pursuing the matter, I invite them to consider technically whether the compensation should go to agents rather than candidates. I believe that by law the agents are required to pay the bill.
	Another cost may well be incurred by the need to post election leaflets which cannot be delivered. The issue of a free post was raised in another place and, indeed, was discussed in your Lordships' House in relation to other elections. We would like to see it used more extensively.
	The placing of a limit on expenses is a different matter. I accept that some candidates will already have started their campaigns. I have a slight doubt about raising the limit because I believe that it may tend to favour those who can pay more towards the cost of the elections. However, we shall not oppose that provision.
	My noble friend Lord Smith of Clifton will refer to the Northern Ireland provisions. I simply observe that the different electoral processes apply not only in Wales and Scotland but also in London. I declare an interest: I was a candidate during the GLA elections last year. I hope that the Northern Ireland Office does rather better than the Home Office has done in disseminating information about the different electoral processes which apply. I observed a good deal of confusion with regard to the different systems in London. Undoubtedly it is a matter that will require resources.
	I turn briefly to the practicalities. The House should be aware that, in our view, the knock-on effects of moving annual council meetings are not only bureaucratic or, indeed, personal--I wonder how many holidays have been cancelled this week--but will mean moving committee dates which follow the annual council meeting. In the real world of providing real services for real people, that means postponing decisions about service delivery. It is at this time of year, following the annual meeting and the move from budget setting to detailed planning, that so often major decisions are taken.
	With regard to the dates of the police and fire authority annual meetings, the Minister in another place confirmed that the appointment term of members of local authorities runs with the electoral term of the local authority. I assume that that applies at both ends of the term, but I should be grateful for confirmation.
	In addition, at present local authorities are all heavily involved in plans for introducing the executive/scrutiny split, which is part of the Government's modernisation programme. I believe that the authorities are required to submit their plans by June. Again in that respect real difficulty is bound to arise because the change of personnel in many local authorities will be postponed. I wonder whether the Minister can comment on that.
	In asking the following question, I do not want to detain the House but rather to give notice to the Government of points that will be raised on Monday. I wonder whether it is appropriate for Clause 1(3) to be in the Bill or whether it is a matter for modification of--I am told by one of my colleagues--the Local Elections (Principal Areas) Rules. Perhaps the Government will consider that, although I do not expect a reply today.
	Finally, does the reference to "ordinary local government election" in Clause 1(1) apply only to principal authorities, and what will be the effect on towns and parishes?
	We note from the absence of government Back-Bench speakers either complete confidence in their Front Bench or their rather luke-warm welcome for the Bill. I am not sure which it is. However, as I said, we on these Benches will not impede the progress of the Bill.

Baroness Young: My Lords, like many noble Lords, I, too, began my political career in local government and have a particular interest in this Bill. Indeed, I live in an authority in which local government elections are held every year. The fact that there will not be a local government election on the first Thursday in May seems a very surprising event.
	This is a very important Bill. We all share a great concern for the reason that has brought it about--the appalling effects of the foot and mouth disease which has come like a plague on our country and which is having such terrible effects on so many industries. I very much share the view expressed so well by my noble friend Lord Cope about the general incompetence which has brought us to this particular position and to the need to debate this Bill today.
	The postponement of an election in a democracy is extraordinary. If one looks around the world at countries that have postponed elections, one can hardly say that they provide very good examples. As I understand it, this is the first time since the Second World War that an election has been postponed. Even then, a Bill was put before Parliament every year to obtain agreement to the elections being postponed. Therefore, it is right that the matter should be debated fully in this House. I regard it as quite wrong that debate on a Bill of this constitutional importance was cut short in another place.
	The Bill enjoys all-party support. Indeed, my party called for a postponement of the elections some little time ago. I believe that it would have been far better if the Bill had been introduced at that stage rather than leaving it until the very last moment. Of course, serious consequences will arise for a great many people as a result of dealing with this legislation in a rush at the last moment.
	I want to make two general comments about the Bill. The first concerns expatriate voters. We are conscious that effectively thousands of expatriate voters have been disenfranchised. I understand that they must all register by 5th April. As that is today's date and as the election is being postponed by a month, would it not be possible to alter the date for registration? I understand that a website exists but that it does not give all the information that expatriate voters require in order to discover whether they can obtain application forms for registration as overseas voters. Given that there is now some extra time, would it not be possible to put right that matter? It would not have been possible had this Bill not come before us. However, as the elections are being postponed, it seems that this important point could be considered.
	The second general point that I want to make is that when, two years ago, we discussed reform of the House of Lords, the point was made on many occasions that the House of Lords has a long-stop power to prevent another place extending its life beyond the present period of five years. Clearly, no such provision exists in relation to local government elections, which is a serious deficiency. I raise the question of whether there should be some such provision; otherwise, how do we know that this type of Bill will not come before us at some point in the future? Of course, we do not know. No one could have expected that this situation would arise and we simply do not know what will happen in the future. Therefore, the Bill sets a precedent.
	I looked into the possibility of tabling an amendment to rectify the deficiency to which I have just referred but, in view of the time constraints and other considerations, it would be very difficult to do so. The issue is outside the scope of the Bill's Long Title. However, I make the point because the issue will not go away and the Government should address it. Our unwritten constitution should contain a measure on, or place a stop against, the sudden introduction of Bills of this nature. Other such Bills might not have the support that this Bill enjoys.
	Before concluding, I want to make four small, practical points about the Bill. First, like the noble Baroness, Lady Hamwee, and my noble friend Lord Cope, I believe that the terms of compensation must be generous. After all, those in local government are, to a large extent, volunteers. They get their expenses--in my day, we did not even get that--and they carry out work that all of us in public life encourage people to do. Local government will suffer considerable expense because of the delay. It is right for compensation to be generous and full, especially in relation to those areas that are badly affected by foot and mouth disease.

Baroness Hamwee: My Lords, I am sorry to interrupt the noble Baroness but I had better make it clear that I was distinguishing between providing compensation for local authorities, which we support, and doing so for individuals, which we do not support. I do not argue with her point about hard work, but we do not support compensation for individual candidates.

Baroness Young: My Lords, I apologise to the noble Baroness if I misunderstood what she said. I think that we can all agree on providing compensation to local authorities. We should carefully consider providing compensation to others. The delay has put many people to great inconvenience and, no doubt, great expense.
	My second point involves the inconvenience caused to employers and employees. Many people who stand for council elections are given three weeks off work by their employers to do the necessary work. Now what will happen? Will they be able to return to their job and get another three weeks off later on? That practical issue affects many people.
	Thirdly, the proposals will have an effect on schools. The noble and learned Lord may make that point when he winds up. I recognise that most schools that are used as polling stations are primary schools, but 7th June is almost the peak time for examinations. If an authority uses a secondary school rather than a primary school for polling, that would be a serious disadvantage to candidates who are taking extremely important public examinations.
	Fourthly, I want to take up another point made by the noble Baroness, Lady Hamwee, who discussed the mechanics of the work of local government. As anyone in local government knows, after a local government election and the announcement of the result, a sequence of meetings takes place. An 11-month year will affect that sequence of meetings. There could be serious delays in, for example, planning applications--important decisions might be held up. Social services and education might also be affected, although planning would be most seriously affected. It is important for local government to know at each step of the way exactly what detailed knock-on effects will apply.
	Other points could be made in this context but we can doubtless examine them in Committee. I accept that it is right to put off the local elections. This serious issue raises many more points than simply those relating to dealing with this emergency. The Bill deserves close consideration and we should not forget the major constitutional points that are raised and which need to be examined. The Bill sets a precedent and we need to understand the circumstances in which we agree to it and what we should or should not agree to in future.

Lord Smith of Clifton: My Lords, I shall confine my remarks to Northern Ireland. As the noble Lord, Lord Cope, has already observed, although provisions relating to Northern Ireland take up more than half of the Bill, the Minister's introduction gave relatively scant attention to it. If I were in his shoes, I should have been tempted to adopt the same tactics.
	My second observation is that I am amazed that, with the notable exception of the noble Lord, Lord Fitt, no noble Lord who hails from Northern Ireland is in his place.
	At first glance, it is not easy to see why provisions relating to Northern Ireland should be included in the Bill, bearing in mind that there has not, thank goodness, been a widespread outbreak of foot and mouth disease there to the same extent as there has been in Great Britain. Moreover, provisions relating to Northern Ireland cannot have been included on the grounds that we expect conformity across the board in the formal arrangements that we make for the governance of the United Kingdom. After all, it was only on 15th February that this House made Northern Ireland an exception to the provisions of the Political Parties, Elections and Referendums Act. We accepted then that in terms of the UK's system of government, there does not have to be uniformity in all circumstances. Indeed, that is axiomatic and entrenched now that there are devolved Assemblies in Northern Ireland and Wales and a Scottish Parliament with greater devolved powers. A very cogent case has to be made for changing the election date, but that case has not yet been made. That is the major principle that lies at the heart of our debate.
	The honourable Member for Cannock Chase, speaking in another place last night, questioned whether it was proper for politicians to change the dates of fixed-term elections. Dr Tony Wright believes, as I do, that if circumstances arise that require the alteration of dates, the decision should be most appropriately left to the new Electoral Commission, which is an independent, non-party-political body that Parliament recently established.
	As regards Northern Ireland, the Bill risks bearing the hallmarks of a gerrymander, which, of course, is not unknown in the island of Ireland. I hope that the noble and learned Lord the Attorney-General will be able to demonstrate that that is not so.
	Apart from the question of principle--that is, whether, short of war or an outbreak of civil unrest, fixed terms for elections should be arbitrarily tampered with--a number of detailed practical questions need to be considered in relation to Northern Ireland.
	First, the chief executive of each of the 26 district councils is responsible for the conduct of elections, with the local deputy electoral officer acting as returning officer for all other elections in Northern Ireland. Did the Government consult electoral officials about whether it was wise to make such a significant change to the arrangements for local elections in Northern Ireland, without notice, or have they merely asked officials about how to do it?
	Secondly, how practical is it to make the changes at such short notice, bearing in mind the particular difficulties of conducting elections in Northern Ireland? Thirdly--a detailed point--will there be two ballot boxes at each polling station? Fourthly, will extra staff be employed to deal with busy times? Fifthly, how will extra staff be organised to speed up voting, because one cannot have more than one person issuing ballot papers?
	If there is a general election on 7th June--the same day as the local elections--who will have legal responsibility for the verification of ballot boxes for council elections if that is done at the parliamentary counting centre under the direction of the deputy electoral officer for the constituency? Moreover, what happens if there is a discrepancy when the council count starts on Monday, 11th June? In that regard, we should bear in mind that in many council elections, under the single transferable vote system, the last seat may be won by fewer than 10 votes--sometimes by much less than that--and that sometimes only four or five ballot papers need to go astray to invalidate the count.
	Why are postal votes to be issued in two separate ways? Moreover, is it not possible to have both ballot papers issued for return in a single envelope with a single declaration? Finally, the rules for opening ballot boxes prescribe that a ballot paper in the wrong box should be counted. Why will a ballot paper in the wrong envelope not be counted? Will postal votes not be verified with other votes?
	I end by stressing that this particular episode has demonstrated the case for fixed term elections for Westminster very well. Every State of the Nation survey made at regular intervals over the past 10 years has shown that there is overwhelming public support for such a constitutional change. Perhaps the Government will now undertake to provide support for Dr Tony Wright's Private Member's Bill which seeks to introduce fixed term Parliaments at Westminster.

Lord Norton of Louth: My Lords, the reasons why this Bill has been introduced are well known and were advanced by the Minister. My purpose in speaking in this debate is not to address the crisis which precipitated it; nor is it my intention to address the implications of the Bill from the perspective of local government. There are many in your Lordships' House who can address those issues much more effectively than I can.
	The Bill has constitutional implications and it is those I wish to address. I do so under two headings. The first is that of options. If it is necessary to postpone elections, what options have been considered? As we know, the Bill stipulates that local government elections shall be postponed until 7th June; others, including the Leader of the Opposition, argue for an indefinite delay. The Prime Minister, in making his statement said, "A short postponement is one thing. An indefinite delay is another". The options may be mutually exclusive. However, they are not exhaustive.
	At least four other options may be considered. One is to delay local elections for a period of several months--say six months. There is no guarantee that foot and mouth disease will be under control by 7th June. So why not allow a little longer? That could meet the balancing test enunciated by the Prime Minister.
	Another option is to provide for a postponement of some but not all elections. Why not postpone elections only in those counties affected by foot and mouth disease? That is an option that was touched upon in the other place last night. As the Minister may be aware, in the general election of 1945 polling was delayed in 23 constituencies because of trades holidays, wakes or fairs.
	The third option is to provide for a postponement of six months but to permit the date to be brought forward by order. That provides some flexibility without giving a blank cheque to government.
	The fourth option is to abolish this year's elections altogether and give the existing authorities an extra year of life.
	My purpose in identifying these options is not to advocate one in particular. It is to show that there are several options. Given the importance that clearly attaches to changing the dates of elections, it is important that we are aware of them and that they are considered. The Prime Minister may believe that the case for 7th June is overwhelming. It may be; but the decision to postpone is ultimately one not for the Prime Minister, but for Parliament. We must therefore consider fully not only the case for postponement to 7th June, but the alternatives to that.
	I therefore pose the following questions to the noble and learned Lord who is to reply. What thought was given to the alternative options? Why were they rejected? We had a partial answer in the other place to some of the options, but not to all. The Minister may also have seen an article in the Independent on Friday by my colleague at Hull University, Mark Stuart, drawing attention to the fact that the general election of 1923 occurred during an outbreak of foot and mouth disease. Can the Minister tell us what study the Government undertook of that occasion prior to introducing this measure?
	I turn to my second heading, which concerns the criteria for delaying elections. Elections are the lifeblood of democracy; they are the means by which electors choose their representatives; they are the means of ensuring a peaceful selection of government, both national and local; and they are a peaceful means of removing a government from office. We must be extremely careful before we start interfering with the blood supply of democracy.
	We have statutory provision for parliamentary and local elections. We stipulate the maximum life of a Parliament. We set dates for the holding of local elections and, indeed, for other elections. We must be wary of moving election dates, certainly of postponing them for any length of time. I see no problem with a minor adjustment, as happened in 1986, because of a clash with Passover. However, once we start postponing them for several weeks or several months, it sets a precedent. The noble Lord, Lord Stoddart of Swindon, raised that concern in putting a question to the Leader of the House on Monday. We have postponed elections in wartime--a point to which I shall return--but should we be postponing them in peacetime?
	If we are to postpone them, we need to be clear as to the criteria that would justify such a postponement. In short, we need to put on record the criteria that will justify what we are doing and, in so doing, set the boundaries for any attempts in the future to move election dates. I suggest that there are four essential criteria that must be met to justify delaying any election, be it parliamentary or local.
	The first is that there must be a clear national crisis; that is, it must be apparent to most citizens that the country faces a domestic or international situation that affects the economic or social well-being or the security of the nation. The second is that the crisis must affect, materially and substantially, the capacity to conduct the elections. That may encompass campaigning as well as actual voting on polling day. The third is that there must be agreement between the parties that there is a case for delay. Unilateral action on the part of government must, in such circumstances, be avoided.
	The fourth is that there must be proper parliamentary debate. Even though there may be a need for speed, this should not be at the expense of proper scrutiny. Agreement between the parties may equal might in terms of parliamentary voting strength, but might does not necessarily equal right. We need to hear all those with a view on the issue. Those who have dissenting views should not necessarily have a veto power, but it is important that their voices are heard.
	All four conditions were met in time of war. Parliament agreed to postpone local and parliamentary elections in both world wars. In the Second World War, local elections were postponed initially under the terms of the 1939 Local Elections and Register of Electors (Temporary Provisions) Act. That Act postponed elections until the end of 1940. In moving the Second Reading the Home Secretary, Sir John Anderson, said that they would be extended by further legislation, "as circumstances require". Circumstances did require, and each year a new measure was introduced and enacted, extending in each case the delay by a further year. It is interesting that, during consideration of the measures, the question was raised by some Members of allowing elections where local citizens wanted elections to take place.
	Parliamentary elections--or rather the election of Parliament--was postponed on an annual basis by a Prolongation of Parliament Act. The 1940 Bill was a one-clause Bill extending the life of the Parliament to six years, and the one the following year fell back on the Septennial Act. It was clear that when Churchill introduced the 1944 Bill, that would be the last of the Parliament.
	There was a clear national crisis. The country was at war. The capacity to hold elections was significantly affected. Many of those who would normally be involved in elections, as officials or candidates, were busy fighting the war. Many buildings where polling would take place were in use for the war effort and the blackout created problems for people getting out to vote. Despite the pressures, Parliament continued to meet, and the measures each Session to extend the life of the Parliament and to postpone local elections were debated, on occasion with critical voices being heard. Parliament continued to do its duty; and indeed it emerged from the war with its reputation enhanced.
	So the four criteria I outlined were clearly met. Are they met in present circumstances? There is a crisis in terms of the outbreak of foot and mouth, and we do not know when it will end. The Leader of the House emphasised on Monday that, in practice, local elections could go ahead on 3rd May. However, the campaign for those elections is likely to be affected by the outbreak of foot and mouth. Candidates and their supporters may have difficulty employing their usual means of eliciting support. Some of those involved in elections are occupied attending to the crisis. Indeed, there is every likelihood--this has already been touched upon--that some potential candidates are farmers isolated in their homes.
	The second criterion is thus met, although I appreciate that there is room for discussion on the point. The case is persuasive rather than conclusive. The third criterion is also met in that this measure will be going through with all-party support. However, the fact that it is going through with all-party support emphasises the point of the fourth criterion; that is, that it must have proper parliamentary scrutiny.
	Proper parliamentary scrutiny has a qualitative and a quantitative dimension. By that, I mean not only must there be sufficient time to discuss the measure, but the Government must also engage in a full and frank dialogue with both Houses. I believe that the time allocated in this House is probably sufficient. It is up to us to ensure that we are satisfied with the provisions. I welcome what the Leader of the House said on Monday about consultation. It is equally important that we have an informed debate on the Floor of the House so that those outside the House can see the basis for our deliberations and our decision.
	A particular responsibility falls on this House. We have the experience and the expertise to subject measures to informed scrutiny. We also have the capacity to ensure that scrutiny is adequate in a way that the other place is unable to do. I understand that we are told that we cannot discuss the procedures of the other place, that the other place is master of its own procedure, and that we cannot interfere with that. I accept that. However, where the procedures of the other place have consequences for Parliament's capacity to determine public policy, we must be able to take note of those procedures. I use this debate to make that point. I regret that I did not pursue it on the Regulatory Reform Bill. I shall pursue it in the future.
	It appears that the criteria that I have outlined are fulfilled in making the case for a postponement of local elections. I say "appears" because some may dispute the fulfilment of the second criterion and the fourth is only partially fulfilled. Furthermore, those criteria establish the case for delay. They do not help us to determine the length of the delay. That is a matter for further debate. One obvious criterion would be that applied in wartime, which is to wait until the crisis is over. However, even the events of 1945 are not conclusive, as there was disagreement on when the coalition should end. We must, therefore, address ourselves to the issue. That means a full discussion of the options that I have outlined. As the basis for that, I look forward to the noble and learned Lord providing a full response to the questions that I have posed.

Lord Rennard: My Lords, in my view this debate on the postponement of elections clearly illustrates the need in this country for a written constitution and a fixed term Parliament. Once again, I find it strangely ironic to argue for democratic principles in an unelected Chamber. Whether elected or not, one of the main purposes of a second Chamber must be to keep a careful eye on how changes may be proposed to our democratic system.
	All democrats should have serious concerns about such a fundamental change to democratic rules as the postponement of any elections. One concern about this legislation is the precedent that it may set for a government, at some point in the future, to decree a national emergency as warranting the postponement of any elections. A deeply unpopular government who are facing disaster at local or national polls may decide that a particular national crisis demands the full attention of the Prime Minister and that therefore some elections should be postponed. Who knows?
	It is 19 years to the day since the Falklands task force set sail from Southampton. Despite the need to chair a daily war cabinet meeting, the noble Baroness, Lady Thatcher, did not feel that it was necessary to postpone the local elections of 1982. I can think of no Prime Minister who has been so closely involved in a local election campaign that he or she has been unable to get on with the business of running the country while local election campaigns took place.
	The fact that the Falklands War was an international crisis and the foot and mouth outbreak is a terrible domestic problem in some areas is not in itself sufficient of a justification to treat the two crises differently. What is different is simply that a general election is in prospect as well as local elections.
	Of course, there would have been some real difficulties in conducting the local elections in some of the worst affected areas such as Devon. The strength of feeling in such areas is such that I am sure that the Government are right to postpone local elections there for a short while, but in the vast majority of areas due to have local elections on 3rd May there are no such difficulties. The question today is why are we considering the postponement of local elections across the whole country. The only real case for the postponement of all the local elections is that the general election will take place on the same day. Everybody knows that, but no one from the Government can say so "on the record".
	The real reason why postponement of all local elections for one month is appropriate is because most people would consider it inappropriate voluntarily to choose to hold a general election at the same time as fighting a crisis that affects so much of our countryside. I have come to accept that argument with some reluctance because for Parliament to postpone any elections is a very serious matter.
	I am also concerned about the signals that that may send to other countries where people are struggling to establish their democratic rights. No doubt Slobodan Milosevic now wishes that he had been able to postpone the last parliamentary elections in Serbia because of the grave crisis in that unhappy country following the failure of his military exploits.
	It seems to me that if any democratic country postpones elections, any such postponement must require considerable consensus among all the main parties. I believe that that would be best guaranteed by a written constitution, perhaps requiring a two-thirds majority in both Houses of Parliament. That would be a proper process for ensuring that the electoral cycle was not simply being manipulated for party advantage.
	A fixed term Parliament would also remove what I believe is an unfair and undemocratic advantage for an incumbent Prime Minister. The Labour Party recognised such a matter in 1992, but sadly lost sight of the principle as the prospect of power loomed in 1997. I believe that it is an issue that must be addressed if the process of constitutional reform in Britain is to continue in the next Parliament.
	There are a number of details in the Bill to be considered. First, there is the issue of whether 7th June is the appropriate date for postponed elections. I believe that they should not take place later because a number of councillors will have assumed that their term of office will come to an end on 3rd May--they may have made other plans for the month of May onwards--and there will be other candidates waiting to offer their services to councils who will need to know in the near future what political direction they will be taking. Above all, it also makes sense for the general election to be held on 7th June so that those elections and all the arrangements and disturbance that go with them can be combined.
	Another issue before us is the request of candidates to be compensated for their consequential losses in printing literature that includes a 3rd May polling date. I understand that that was a request made by the Conservative Party. If so, that appears to be yet another occasion when the Conservative Party requests state funding in addition to that which it currently receives via the so-called "Short money", the funds paid to the office of the Leader of the Opposition, the funds paid for the implementation of the Political Parties, Elections and Referendums Act and the funds shortly to be on offer from the Policy Development Fund.
	Although my party believes that limited state funding would be better than dependency on a few wealthy individuals and organisations, we do not believe that state funding to compensate council candidates in this way would be appropriate. These elections are being postponed out of respect for the feelings of those in the countryside who are suffering from the foot and mouth outbreak. Imagine how outraged they would be if, while they await details of compensation for farmers and others, candidates who had simply printed their leaflets too early were to be compensated first. I believe that the Government should drop such an idea.
	The matter of compensation to councils for their costs is a different matter. However, I was greatly surprised on Tuesday to hear the noble Baroness, Lady Jay, the Leader of the House, argue for compensation for the cost of printing the ballot papers. Our country is an even less democratic place than I thought if local authorities have been able to print ballot papers even before nominations have closed. There will be plenty of time to print them between now and polling day if the legislation falls. There will, however, be some modest costs which they must incur in publishing lists of candidates and so forth.
	Overall, there should be a considerable saving to many councils if the cost of running local elections on 7th June is combined with a general election on the same day. There will be no need to hire polling stations and special staff on two different occasions.
	Finally, those responsible for organising these elections, those who participate in them and indeed the whole country would benefit if we changed from a system in which the date of our elections could change according to the changing mood of the Prime Minister and in which we did not have to rely on purchasing the Sun newspaper in order to find out when polling day would be. We would benefit from a system which provided advance certainty of when our general elections would take place.

Lord Campbell of Alloway: My Lords, before the noble Lord sits down, perhaps I may ask him a short question. I listened with great attention and respect. Is he advocating a written constitution?

Lord Rennard: My Lords, yes, indeed. I thought that I was specific on that point, but I was not sufficiently clear and I apologise. That has been the long-standing policy of the Liberal Democrats, and would provide considerable assistance during situations such as this.

Lord Norton of Louth: My Lords, before the noble Lord finally sits down, can he tell us how many written constitutions stipulate the dates on which local elections shall be held?

Lord Rennard: My Lords, as there is no written constitution for this country, the situation has not yet arisen. I am not sure how many overseas countries have written constitutions. However, the United States, for example, has a fixed period of four years for presidential elections. If the same applied to this country, we would not have the present problem of not knowing when our general election will be.

Lord Norton of Louth: My Lords, before the noble Lord finally finally sits down, that would not apply to the terms of local elections in the United States.

Lord Rennard: My Lords, I must admit that I am no great expert on local elections in the United States.

Lord Greaves: My Lords, I believe that the constitutions of the states of the United States specify when the state elections should be. That is relevant to what my noble friend said. My noble friend Lord Rennard said much of what I had intended to say, so I can make a shorter speech.
	It is clear that there is considerable unease about the Bill among Members on these Benches. My noble friend Lady Hamwee said that as a balance must be struck between the arguments she had come down on one side. That is the view we shall take and the way we shall vote during the passage of the Bill.
	It is right and proper that concern and disquiet should be expressed about the way in which the date of public elections was unilaterally changed by the Prime Minister at almost a moment's notice and in the knowledge that he could use his parliamentary majority in another place to ensure that that was agreed. Would we be discussing the Bill here today if there were not a general election in the offing? The answer is probably not.
	We might well have been discussing a Bill about Northern Ireland, because it is clear that the Northern Ireland sections of the Bill have been in preparation for more than a couple of days. It is equally clear that the sections which refer to England and Wales were put together on the back of a fag packet, or whatever people use in these non-smoking days, in the couple of days before the Bill went to the Commons.
	We might indeed have been discussing the kind of measure suggested by my noble friend Lord Rennard and the noble Lord, Lord Norton; that is, the ability of the Government to postpone the local council elections in areas where there is serious difficulty. No one who knows Cumbria could argue that a postponement of elections there does not have a great deal of merit.
	The Bill postpones all the by-elections which are scheduled from 3rd May onwards. However, there does not appear to be a great need to postpone the pending by-elections in Islington or the middle of Manchester. I do not suggest that the Government have paid attention to the fact that the Liberal Democrats are likely to win those two seats from the Labour Party, but that will probably be the case whenever the elections are held.
	By-elections have been taking place since the foot and mouth outbreak began and they will take place today. They will continue to take place in dribs and drabs until 3rd May when suddenly they will stop. There seems to be no great logic behind that. It is substantially agreed across the parties that it would be wholly inappropriate to hold a general election on 3rd May and there is general agreement that the local elections should therefore be postponed. That was put forward most eloquently by my noble friend on our Front Bench. However, it has become clear that the support given from these Benches is accompanied by two cheers and not three and by considerable reservations.
	There are strong alternative views within local government in many parts of the country. They were expressed, for example, by the Labour leader of Cheshire County Council and by the leader of the Labour controlled Lancashire County Council where I live. I hesitate to suggest that I speak for them in any way, but it is right that those reservations should be expressed here today.
	Issues of principle are involved when politicians postpone scheduled elections. Not for the first time, this House should be grateful for the presence here of the noble Lord, Lord Norton, who can better express these matters from his expertise and intelligent observation. I look forward to reading his speech in Hansard and I hope that the Government do, too. I hope that it will be taken as a first stage in the establishment of principles on which such decisions can be made in future.
	There is an irony, perhaps a paradox, that in this country it is being suggested that if we have a severe national crisis the answer is postponing democratic elections. Together with the rest of Europe and the United States, we are telling people that if they have severe crises in their countries they should hold democratic elections because that is part of the answer to crises. We would have been horrified if Milosevic had been able to postpone the elections in Serbia.
	Bosnia lurches from crisis to crisis almost by the day. Part of the answer which is being pressed on Bosnia by the international community is to hold more elections. In the past few years since the Dayton agreement, Bosnia has held more elections than any other democratic country. If we are sending a message to people such as President Mugabe that the answer is to postpone elections when things become difficult, we have a problem. If while we are telling the rest of the world, "If you have severe crises, rely on democracy to help sort them out", we are seen to be going against that advice, there is an irony and perhaps an illogically.
	It is not clear why the Government believe that the census can go ahead when elections cannot. It is not clear why the Government are telling tourists that the countryside is open and that they should go to the countryside. I read in the newspapers that Labour MPs are being forbidden to go to foreign countries for the Easter holidays and are being told that anyone seen in the South of France, for example, will be severely reprimanded. I can promise them that I shall be in the South of France and I shall report anyone I see there. If the message is that the countryside is open but people cannot do something as simple as casting their vote, there is a lack of reason.
	There are serious concerns. Certainly, the Government will get the message that they are unlikely to receive support from our party if the postponement goes beyond 7th June. Having said that, it is clear that this Bill will pass into law.
	I should declare an interest. I am involved in organising our local election campaigns, which have already started. Not only have we printed leaflets bearing the date 3rd May but we have delivered them through letterboxes. That gives us an excuse to print some more leaflets to tell people that, after all, the election will be on 7th June. But our party has never been averse to printing more leaflets.
	Another concern is expenses. I agree with the point raised by my noble friend Lady Hamwee about rich and poor parties. But there is also a concern that if campaigns are to last much longer even the revised expense limit for those who print lots of leaflets will not be enough. I am advised that if there is a deferred election because of the death of a candidate the expense limit is doubled to allow for the re-election. I would have thought that a doubling of the expense limit was more sensible than a 50 per cent increase. However, 50 per cent is welcome.
	I turn to postal votes. RPA Circular No. 440, which I believe my noble friend quoted, states that,
	"The arrangements for the elections on 3 May will be transferred to 7 June by the Bill. Electors who have applied for postal votes for 3 May only can therefore continue to be included on the postal voters list for 7 June".
	One is not sure where to look for the changes to the rules which allow that to take place. The position is fairly strict. If one makes application for a postal vote for an election on a particular day it applies to that day. Can the Government tell the House whether that will be covered in subsequent regulations--if not, how it will be dealt with--so that returning officers are absolutely clear that, as a matter of course, if they have received postal vote applications for 3rd May they should be transferred to 7th June, unless the electors indicate otherwise?
	There is also a question about the inspection of nomination papers and consents to nomination. That may not be something which a lot of people do in this country, but in parts of the world where there is experience of electoral fraud and forgery that happens. There is provision in Rule 9 of the Local Elections (Principal Areas) Rules 1986 for the inspection of nominations which have been submitted following nomination day. The question is: which nomination day now applies to that? Can nominations which were submitted and accepted before nomination day two days ago now be inspected, or does one have to wait until after the next nomination day in early May?
	Finally, I am confused--perhaps it is my fault--about the particular electoral registers which are involved in these elections. It is clear from the circular sent out that the register which tells one who is qualified to vote is the new rolling register to be published in early May. I am not clear about the qualification for signing nomination papers for these elections because we have had a series of different dates. Which register will be in force for those people who sign nomination papers up to and including the new nomination day? These are important matters. Unless the Government get the amended rules and system right people will find themselves, through no fault of their own, in difficult circumstances.
	If there is to be a new document to amend the Local Elections (Principal Areas) Rules for England and Wales when is it likely to be available? How extensive do the Government believe the required changes to the rules will be?

Viscount Goschen: My Lords, I welcome the introduction of the Bill as the right thing to do in dire circumstances, but I strongly believe that the Government made the decision about whether or not to delay the local elections a great deal more difficult for themselves than it needed to be. Undoubtedly, they have let the timing of the general election cloud the issue of whether or not the local elections should be postponed. To the extent that Ministers backed themselves very deeply into a corner by making dire predictions of what would be the consequences for the tourism industry of this country if the elections were delayed, that is precisely what has happened. They have ended up with the worst of all worlds. Had they not concentrated so heavily on the timing of the general election and its relationship to the local elections, the decision could have been taken a great deal earlier with less collateral damage to the tourism industry, which we greatly support and seek to shore up under very difficult circumstances.
	The House should be under no illusions about the constitutional importance of moving elections, be they general elections or local elections. My noble friend Lord Norton of Louth covered those issues in considerable detail, and I am sure that the House is greatly in his debt. However, this debate emphasises the importance of your Lordships' House in terms of discussing constitutional arrangements. Although it is a convention of this House that it does not discuss what goes on in another place, it is clear from the thinness of Hansard that the guillotine was applied. It would be very difficult to argue that a thorough debate took place in the House of Commons and that every Member who wished to speak was able to put his view on this extraordinarily important and constitutionally significant issue. The debate was guillotined and the Bill sent here with all speed.
	We have the ability to conduct our debates in this Chamber at our own speed. It is clear that, while the Government could well have taken a decision without all-party support in another place and got the measure through, in your Lordships' House they would have had very much more difficulty if they not been able to secure that support. As my noble friend Lady Young pointed out, when one comes to consider the question of the potential postponement of general elections, as in the past your Lordships' House has a very important role to play. Now that the decision has been taken to delay the local elections until 7th June, I urge the Government, and the noble and learned Lord, Lord Williams of Mostyn, who is to respond on their behalf, to consider very carefully the need for flexibility and the proposition put forward by my noble friend Lord Cope.
	We are told that two clear criteria led to the postponement of the local elections: the need for politicians to focus on handling the epidemic and the feelings and sensitivities of those most directly affected. Clearly, no Minister will now stand up and make predictions about exactly where the epidemic will be in two, three or four weeks' time, or by 7th June. We do not know how much time will be required by local and central government politicians to continue to focus on handling the epidemic. It is also clear that even by 7th June both central and local government will be required to undertake a very great management task.
	As to the second criterion, it is not difficult to predict that the feelings and sensitivities of those most directly affected, who have had their livelihoods taken from them in the most extraordinarily trying circumstances, will still be considerable on 7th June. The suggestion of my noble friend would at least provide a measure of flexibility. I agree with members of the Liberal Democrat Party who have said that they do not want to sign blank cheques in relation to the postponement of elections. Given the position of your Lordships' House, as I mentioned earlier, over postponing elections, clearly that is not something which this House would want to do without some very carefully defined criteria about the circumstances in which additional delay is created. I say no more about that beyond urging the Government not to stick to 7th June, chosen for no particularly obvious, scientific or closely argued reason. It was a date supplied to the Sun newspaper last Friday.
	Perhaps I may raise a few points of detail. If the noble and learned Lord, Lord Williams, does not have time to respond, I shall be very happy to receive a letter from him. Clause 1 deals with the circumstances of candidates who have already been nominated. Can the Minister confirm the situation as regards new candidates who have not already registered? The explanatory notes say that the deadline for new candidates in England and Wales will be extended to 10th May, but I do not see that in Clause 1. Perhaps the noble and learned Lord can put me straight on that.
	As regards an additional expenditure allowance or allowing candidates to spend up to 50 per cent more, there is a provision in the Bill which states that whenever such candidates were nominated, if they have not already done so, they would have an advantage in being able to spend 50 per cent more than their opponents who might well have already spent their additional 50 per cent. I wonder what is the argument for allowing candidates, who have not yet put themselves forward, still to be able to spend 50 per cent more. Perhaps I am not correct on that.
	I believe that the Minister needs to give the House further clarity about compensation. There is widespread agreement among noble Lords who have spoken that local authorities should be compensated for expenses incurred in staging elections. I believe that I heard the noble Lord, Lord Bassam, say that the Secretary of State might leave open the option of compensating independent candidates, but not those from political parties, as recognised under the law. The House deserves slightly more explanation of why that should be. It seems to discriminate in favour of one candidate against another.
	Clause 7 gives a fairly wide power for the Secretary of State to bring forward consequential, transitional or supplemental provisions. It would assist the House if the Minister were able to indicate, not exactly what the measures would be, because they would be defined, but the type of areas which would be covered by the provisions. I raise these detailed points at this stage to enable the Committee stage to proceed more quickly. However, I welcome the introduction of the Bill although with a sense of deep regret at the terrible circumstances which led to it.

Lord Hanningfield: My Lords, as many noble Lords will know, I am the leader of Essex County Council and therefore have a direct interest in the elections. I am standing again. I have already printed my leaflets. Therefore, I have already incurred some expense. But I am not asking for compensation for that. I agree with noble Lords who have said today that candidates should not be reimbursed for expenses already incurred, but certainly councils' expenses should be reimbursed. I may return to that in a moment.
	Essex was the first county with an outbreak of the foot and mouth disease. It was first found there. I live in a village which had one of the first signs saying, "You are now entering a foot and mouth restricted area". For many weeks I have been saying that we should know what we are doing. There has been total confusion in local government over the past few weeks. Although the position has now been clarified by the Government, I wish that that had been done earlier. I have many friends in Devon and Cumbria, and it was quite apparent two or three weeks ago that there could be no county council elections in those counties. I come from a farming background and I know of the chaos and crisis in those two counties. In the rural counties, such as Devon and Cumbria, most local government members represent the countryside.
	Several noble Lords have referred to the confusion and I, too, should like to concentrate on it. I am the leader of a council which had planned an annual meeting. I ask the Minister to clarify the situation as regards such meetings. Clearly, there can be no annual meetings of councils with elections pending until after those elections have taken place. Therefore, it should be stated in the Bill that the annual meetings of councils with forthcoming elections should be held afterwards. I gather from the Explanatory Notes that the measure is designed for all councils because there may be by-elections which affect the balance of power in such councils. Any council can now have its annual meeting in June, but I should like clarification of when those meetings should be held. As has already been said, this affects fire and police authorities where in particular the county members could alter the balance of power. I should like some clarity on those issues.
	Management of a county will be very difficult for the next month or two because, as has already been said today, by the end of June we have to submit our proposals for the new modernisation agenda. I hope that the Government will allow some latitude in the dates because if we are not to have elections until early June, and if we have our annual meeting in the middle of that month, it will be impossible to submit proposals to the Government by the end of June for the reform of local government structures. I hope that the Government will comment on that.
	My noble friend Lady Young spoke about meetings. We had some planned for the new council after May. As the leader of the council, I shall have to consider how we can manage the business of the council until we have an annual meeting in June. It is difficult because in Essex the Labour leader is retiring and many of my most able councillors are not standing again, mainly because of age. All three parties will have quite a change-over of county councillors. Many of them have planned holidays and visits with their wives to see their children. There is quite a difficult management problem for my county over the next few months. Both my noble friend Lady Young and the noble Baroness, Lady Hamwee, referred to this matter. I hope that the House will understand our difficulty.
	I agree with my noble friend Lord Norton of Louth and with my noble friend Lady Young that this Bill raises constitutional issues. We have had certainty in local government about elections. Now, for the first time in my 30 years' experience, it is being changed. I support the Bill because of the crisis in the country, but this is something which we would not wish to see again. I hope that we can do something about the constitutional arrangements for the local government elections so that there is some certainty about our election dates. I support the Bill at this stage, but I wish that we had had it earlier.

Lord Fitt: My Lords, I shall speak specifically about Northern Ireland. Over the past four years since 1996 and the alleged IRA ceasefire, a great deal of legislation has passed through your Lordships' House in direct contradiction of what was taking place in other parts of the United Kingdom. We were told that Northern Ireland was different: the political circumstances and the terror campaign together put Northern Ireland in a different category from the rest of the United Kingdom.
	In this Bill we now have the assertion that we must not draw a distinction between Northern Ireland and the rest of the United Kingdom because of the foot and mouth disease outbreak. As has already been said, there has been one case of foot and mouth disease in Northern Ireland. The disease has been contained due to the excellent work of the Minister of Agriculture in Northern Ireland.
	We have heard the Prime Minister say repeatedly that to postpone elections would send out the wrong signal to potential tourists. At this time of the year Northern Ireland is influenced to a great extent by the number of tourists it can attract to its shores.
	It would be the wish of the majority of the people in Northern Ireland that they be allowed to hold their local government elections on 16th May as scheduled. Therefore, one must ask whether these local government elections are being postponed because of foot and mouth disease. The answer to that is an emphatic "No". Many by-elections have been held over the past 30 turbulent years. People have been killed because of their religion, the way they speak and the way they vote.
	In the wake of internment being introduced in August 1971 there was a real crisis in Northern Ireland. In 1972 many nationalists resigned their local authority seats in protest at the way that internment had been introduced. That did not stop the elections. The then Conservative Government allowed elections to take place. They said that they could not stop the elections taking place. That meant that bigoted unionists, who were totally opposed to the nationalist beliefs of those who had resigned their seats, walked in and took seats on an unopposed return. That was a clear violation of the democratic wishes of the people in those local government areas.
	Nineteen seventy-two was one of the worst years of the Northern Ireland troubles. Over 472 people were killed in that year. Early in that year one of my party colleagues in the dock area of Belfast, in which I was also a councillor, resigned his seat. That meant that there had to be a by-election. I spoke to the Minister in charge of Northern Ireland at the time. I said to him, "Could we not postpone this election?" because if we did not it would mean that a unionist who was diametrically opposed to my political beliefs would take that seat. I decided that we could not let them have that seat. What happened then was that I could not get a candidate to fight the seat. The IRA threatened that whoever was to stand for it would be killed. In fact at the last minute I had to put forward my wife.
	At this time there is no justifiable reason to prevent the Northern Ireland local government elections going ahead. The Government should take that into consideration.

Lord Biffen: My Lords, this mini debate is but a token of what it should be, but it is infinitely greater than what was offered by the other place when considering the measure. It is a matter of constitutional import. The speech by my noble friend Lord Norton emphasised that. I should like to try to underline some of his comments. It is a simple test. Imagine that this was taking place not just ahead of a general election but just after a general election. Suppose we then had the foot and mouth epidemic and we had ahead of us the local authority elections. I cannot believe that a government would argue that those elections should be postponed.
	The whole history of life is this determination to hold elections come what may. During the war there may have been a party truce but there was never a suspension of the by-elections, many of which carried a message that reverberated across the nation and to the fighting front. What is proposed is not what would have been suggested in the alternative theoretical circumstances outlined. What would have been suggested would have been a means of identifying in Devon and in Cumbria where there should be special arrangements. Maybe there were special arrangements nationally to make voting that much easier. We have those circumstances now. Just as for the 1945 general election--there may be problems of hybridity--special arrangements could have been designed for those areas acutely affected by the foot and mouth disease. The Lancashire seats affected by Wakes Weeks were given different voting occasions from the general election that took place in the spring of that year.
	The problem has arisen because of the proximity of the local authority elections and the intended chosen date for the general election. It is not so much because of the problems which will affect an election in the areas of the foot and mouth disease, dire though they will be, I do not deny. I cannot believe that the Government would not secure quite a high turn-out in the areas affected because the voters will wish to make their opinions known and their political influence felt. I do not think that we would have a situation where there was a minimal vote in the areas affected by foot and mouth, although I agree that their differences should be recognised.
	What is at stake here is the welcome decision by the Prime Minister to see that this foot and mouth scourge required national political leadership. It required his identification with the scourge and with all the plans that had to be co-ordinated to give most effect to countering it. He could not set that role aside as a part-time occupation in order to lead a party in the general election. Nor could he put to one side the task of being the supremo in fighting foot and mouth to take time off to fight a general election.
	That is the background to this device. That is the real underlying constitutional case to be considered. We are being asked to nod this legislation through. I shall nod it through. But the time will come when the annals of these two or three days' debates will be looked at by students outside this place and people concerned with our constitutional liberties. They will see that we have been sleepwalking and it is only in this place that there is any reasonable voice raised to alert us to the danger.

Baroness Carnegy of Lour: My Lords, with your Lordships' agreement, I should like to make a very small intervention, not on the scale of the one that has just been made.
	The noble Lord, Lord Bassam, explained in introducing the Bill that there had been no problems in Scotland and Wales in voting on the same day on two electoral systems. Therefore, it was thought that it was quite possible to do that in Northern Ireland.
	As someone who was on duty outside quite a large busy polling station on the day when the Scots Parliament and local government were elected on different election systems there were problems for some people. It may be helpful to the Government if I point out those problems now before we come to Monday and the Committee stage.
	The problems were twofold. The first problem was that some voters came thinking that they were taking part in a single poll for two different bodies. They knew what the two bodies were. They thought it was a single poll. They were confronted with two ballot papers, which surprised them. They thought they had to vote for the same party on both papers. Some were confused because their particular view about the election was that they wanted to vote for different parties. Confusion could have been avoided if there had been an official explanation that this was not the case. The parties had been saying it and it had been aired in the media quite often. Nevertheless, a significant number of people were confused by that.
	I raised the other problem during the passage of the Scotland Bill. I was told that it would not happen, but it did. I refer to the colour coding which involved two different colours for the two bodies which were to be elected. That is what is planned in the Bill. It was difficult for people who were colour blind. The reason for that was that colours had to be found for the ballot papers that were not associated with political parties. The colours with which we ended up were difficult for voters--it turned out that it was mostly male voters--to distinguish between. It was a real problem because not only were the ballot papers different but the ballot boxes were marked with the same colour as that which was on the ballot paper. I do not know whether it should be legislated for, but the Government need to ensure that the colours are bright and of a kind which are distinguishable by people who have that problem.
	Those may not be big problems on the ground but they are sufficient to upset people. I should have thought that, with the sensitivities in Northern Ireland, both points are worth thinking about.

Baroness Scott of Needham Market: My Lords, I begin by declaring an interest in this matter in that I am a member of Suffolk County Council. As a local authority member, I was warmed by the sudden focus on and interest in the county council elections. I am grateful to all noble Lords who have spoken in the debate and have made such interesting contributions from a variety of perspectives. In that regard, I am especially grateful to the noble Lord, Lord Fitt, and to my noble friend Lord Smith of Clifton for focusing on the provisions in the Bill relating to Northern Ireland, which actually form the bulk of it but have received rather less attention than they would otherwise have deserved.
	When I was re-elected to the county council in May 1997, I knew exactly how long my term of office would be and was able to pencil into my diary the date of the election. As my noble friend Lord Rennard pointed out, since even war in the Falklands had failed to disrupt the local democratic processes, it seemed like a fairly safe bet for me to do that. Even until recent weeks, when it became increasingly clear that it would be highly inappropriate and damaging to the democratic process to hold a general election in May, there was a fairly widespread view among local authorities that the local elections could go ahead in all but the areas worst affected by the foot and mouth crisis.
	In practical terms there is no reason why the elections could not have gone ahead. The noble Lord, Lord Bassam, conceded that point at the beginning of the debate. Of the 24 million people who are represented by county and unitary authorities affected by this legislation, a relatively tiny number of people would have serious reason to suppose that their participation in the democratic process would be significantly hampered by the election being held on 3rd May. Postal deliveries are carrying on almost unaffected, suggesting that political parties would be able to deliver their leaflets. Indeed, by recognising the longer campaign and extending the expenses limit accordingly, it is likely that more people will be walking around the countryside delivering more pieces of paper in this extended campaign. People in rural areas are still getting out and about to work, school and shops, and would therefore have been able to vote. In fact, as my noble friend Lord Greaves pointed out, the fact that the census is still due to take place demonstrates that the reasons for delaying the election are not based on practical considerations.
	The real reason is to provide a fig leaf for the otherwise appropriate decision not to go ahead with the general election on the date which, if the media are to be believed--it appears that the Sun usually is--was pencilled in as long ago as 1997. While I agree that holding a general election during a crisis of this kind would have been highly undesirable, I am less than happy to think that the Government's unwillingness to hold national elections after a set of potentially bad local election results has in any way influenced their decision to delay local elections. There is every difference in the world between choosing not to exercise the Prime Minister's right to set his own date for the election and a decision to postpone dates which are fixed.
	What really concerns me is the proposal from the noble Lord, Lord Cope, that the legislation should provide an open-ended delay. In my view, that would represent an entirely unjustifiable and dangerous control by the executive over local democratic processes and must be resisted at all costs. There are serious practical implications from this step. Local authorities are big business. My own authority in Suffolk is the largest employer in the county, with some 23,000 full-time equivalent staff. The various budgets come to over £1 billion a year. Local authorities are run like businesses, with planning and budgetary frameworks that affect the lives of people in their areas and run to millions of pounds. These cycles are predicated on four-year electoral cycles and should not be altered lightly.
	The uncertainty created by the open-ended delay proposed would be horrendous and would have serious practical results. For example, in Suffolk the structure plan is due to be determined within the next few weeks, creating the framework within which many thousands of new homes will be built in the county. It is a decision worth billions of pounds. As the noble Baroness, Lady Young, pointed out, the development control planning system could be severely hindered by such delays. As the noble Baroness has recognised that, it seems strange that her Benches support open-ended delay. Some 25 per cent of councillors are due to stand down in May. While they may be prepared to hang on for another four weeks, any delay beyond that will see the gradual erosion of their numbers, leaving large areas of the country unrepresented at county and unitary level. In finely balanced authorities, political control could change without a single vote being cast anywhere. That would be a travesty of democracy.
	Even with a one month delay, there are some serious issues to be addressed, either today or in Committee on Monday. As we have heard, annual general meetings are due to take place in May, as are those of the police authorities and combined fire authorities. Those are all affected by the delay. I should like some clarification today as to how these changes will be managed.
	Councils are due to make their final decisions about the new structures required under the Local Government Act. That must be done by June. That means that new councils, with around a third of their number being new councillors, and with many having changed political control altogether, will be asked to take these important decisions within days of an election. Will the Government consider a dispensation for those authorities affected by the legislation so that they can make their structural changes later, perhaps by the end of July?
	Local councils are currently in a pre-election purdah, which affects the style of their public announcements and the way in which public relations are dealt with. Is that purdah to be lifted after Royal Assent and then reintroduced, or will it remain indefinitely?
	We on these Benches are greatly concerned about compensation for individual candidates and hope that we can have some clarification on that issue, either today or in Committee on Monday. We should like to press the Government to give more thought to the issue of freepost leaflets for council elections.
	My noble friend Lady Hamwee said that the issues are finely balanced. I am very grateful indeed to the noble Lord, Lord Norton of Louth, for giving us an intellectual framework within which we can consider the issues. On balance, we will support the legislation. We will not impede it in any way. However, we have significant reservations. Some of them may be addressed through discussion today and on Monday, but others will remain a difference between us.

Baroness Hanham: My Lords, I thank all noble Lords who have taken part in the debate. I am bound to point out that, apart from the noble Lord on the Front Bench opposite, the burden of the debate has been borne by the Liberal Democrats and the Official Opposition. There has been a distinct lack of interest from elsewhere. The contributions to the debate have been of an extremely high standard. I am sure that the Government will take particular note of that.
	My noble friend Lord Cope said that it is an extraordinary Bill. As the debate has proceeded, those words have seemed prescient. Running throughout the debate has been a very real cynicism as to why the Bill has been brought forward at all. Of course there are problems over the county council elections and the proper democratic processes, but the fact that the election postponement was first seen in the Sun was a poor way for the matter to have been dealt with. There are other and more appropriate places for the announcement of the postponement of elections to be made. It might have been better if both Houses of Parliament had been given the benefit of the Prime Minister's thoughts on the matter before the press were able to announce the decision with such fervour and vigour.
	The Bill delays the county council elections, but we have all agreed today that it concerns not only those elections. The only rational reason why the Bill has been introduced is because the Prime Minister wishes to delay the general election. Of course that rationale came about after he had made a field trip into the country and finally, I believe, saw for himself the terrible constraints under which people in rural areas are operating at present. I do not think that anyone would want to deny the difficulties, concerns, problems, unhappiness and misery affecting many parts of the country. Not all regions are affected, but where there are problems from foot and mouth disease, those are very real.
	Furthermore, no one would want to deny the difficulty of trying to manage the democratic process for people living in the affected parts of the country. Those problems, too, are very real indeed. As has already been pointed out, several candidates are farmers, who are now stuck behind their five-bar gates displaying notices stating, "Come no further. Foot and mouth disease". They would find it extremely hard to canvas effectively or to fulfil their democratic duties. Equally, it would be hard for people to get to them to ensure that they can receive material relating to the democratic process, even if they are not directly taking part in it.
	But why will all this be over by 7th June? Why has that date been plucked out as the day by which everything will have been brought under control? The situation as regards foot and mouth disease will have improved to such an extent that the Prime Minister will be able to say with full confidence that all the problems that existed for 3rd May will not equally exist for 7th June. That is the reason why my party has suggested that to put a final date of 7th June on to the face of the Bill is unwise. It would have been much better to leave the date open so that, if necessary, the process could be extended--if not for the whole of the country, then for those areas where foot and mouth disease might still be as prevalent as it is now. That is the reason why we have suggested that the firm date of 7th June should not be put into the Bill in the way proposed. If that is agreed, we shall not have to repeat this debate if the situation should remain the same. However, my cynicism urges me to think that 7th June will be the date, whatever happens. None the less, we still have to keep up the pretence that we are discussing only the county council elections and not the general election.
	The debate has covered not only the merits or demerits of the Bill, it has also touched on the extremely important constitutional issues which have been raised by what is being proposed. The postponement of an election in this country, one of the seats of democracy, is more than unusual; it is an absolutely unique occasion. My noble friend Lord Norton, along with the noble Lord, Lord Rennard, and, to an extent, the noble Lord, Lord Greaves, have all underlined--along with my noble friend Lady Young--the real concerns that have been raised about the constitutional issues relating to delaying elections. I am certain that that does not have to be emphasised in this House, but I hope that this will be taken on board and that such an event will not take place again without all the detail of such an expediency being worked out very carefully indeed.
	Apart from the problems associated with foot and mouth disease, the matter of tourism has been raised in our debate. I know that this formed part of the important debate held yesterday in your Lordships' House. Not only are farmers affected by the foot and mouth outbreak, tourism also is suffering, in particular in those areas which normally welcome many tourists at this time of year. Tourism has been high on the agenda of Ministers going around the country and I understand that it has formed an important part of the rationale behind the Bill. Of course we accept that that aspect of this situation must be taken into account.
	The practical issues relating to the delay have been spelt out very well. We are lucky to have in this House a number of noble Lords who not only will be standing in the local elections, but who have great experience of them. I refer to the noble Baroness, Lady Scott, my noble friend Lord Hanningfield and the noble Baroness, Lady Carnegy. They have drawn attention to all the details that must be attended to. Those points were also mentioned by the noble Lord, Lord Rennard, who probably knows more about elections that the rest of the House put together. The practical issues surrounding this decision should not be underestimated; they are serious and they need to be dealt with properly.
	I take some issue with the noble Lord, Lord Rennard, who seemed to suggest that the Conservatives believe that everyone should benefit from swathes of compensation as a result of what has gone wrong. That is not the case and never has been. My honourable friend in the other place raised the issue of what might happen if a great deal of money had been spent, but it has never been our intention that individual candidates should be compensated. I should like to make the Conservative position quite clear: we do not think that people should be compensated. The question of independent candidates who are funding themselves because they have no party behind them was raised and perhaps has not yet been resolved. However, in common with all noble Lords who have spoken today, we believe that, from the candidates' point of view, this is probably just bad luck which will have to be dealt with in some other way.
	A great part of the Bill is devoted to Northern Ireland. We were lucky that the noble Lord, Lord Fitt, was in his place and was thus able to speak in the gap. We are grateful for his contribution, as we are to the noble Lord, Lord Smith. Had the noble Lord not spoken, those provisions would have passed without notice, and two-thirds of the Bill would have been without comment. That is why we need the experience of Northern Ireland Members. I hope that we shall have the benefit of that experience again when we consider the Bill in Committee on Monday. That will ensure that the provisions relating to Northern Ireland will be thoroughly scrutinised.
	I thought that the noble Lord, Lord Fitt, made an extremely powerful speech, explaining to the House how Northern Ireland has survived over the past years and how the democratic processes over here have not always made it easy for those in Northern Ireland. I hope very much that the noble Lord will be able to come to the House on Monday. As other speakers have said, we need to scrutinise this Bill as carefully as possible. It is vital that this House undertakes the duty--the time for which was not allocated in the other place--of examining the detail of this legislation. In this country a Bill of this magnitude--however short it may be--cannot be seen to go through without having been given the most careful thought. We must ensure that it is put forward correctly, all the issues having been taken into account.
	From this side of the Chamber we shall certainly do that--no doubt many other noble Lords will join us--to ensure that the Bill, to which ultimately we shall agree, has been made clear in its detail. Our agreement to it has been clearly stated by the Leader of the Opposition in the other place and by my noble friend Lord Cope. However, we do not believe that such a Bill, and in particular one which has so many question marks over the reasoning behind it, should simply coast through both Houses.

Lord Williams of Mostyn: My Lords, as the House knows, I have had a very long connection with Wales and with those who farm in Wales. The troubles that have afflicted our colleagues who are concerned with farming all over the United Kingdom were reinforced when a number of us made the rather sad journey to Anglesey for the funeral of our late friend Lord Cledwyn. It was almost exactly the time that foot and mouth was discovered in Anglesey. So we proceed on the common ground that we feel deep sorrow and sympathy for all those who suffer.
	The two characteristics that struck me in listening to the debate--I have had the pleasure of hearing every speech--were that one finds not only expertise in this House but also independence of mind and thought. Both characteristics are sometimes inconvenient to someone in my position, but not on this occasion.
	It seemed to me that the debate separated itself into two constituents. First, there were some heavy-hitting contributions on wider constitutional matters. I agree that they are not to be overlooked simply because we are dealing with local, rather than national, elections. The second constituent concerned particular points of question.
	The noble Viscount, Lord Goschen, with his customary courtesy, said that it might be helpful if particular questions of detail were answered in writing. Other noble Lords took the same approach. I shall take up that offer, if I may. I am not a Home Office Minister, but I undertake on behalf of the Home Office that all questions will be answered--probably, I hope, in a compendious letter, which should go out tomorrow--so that we will, if at all possible, have settled some outstanding issues before we come to the Committee stage. A number of your Lordships suggested that as a sensible outcome, and that will be done.
	A number of questions were asked as to why postponement was necessary at all. I detected incipient schizophrenia in some of the speeches, which seemed to be uncertain as to whether this was a good idea or something to be abominated at all costs. How those different approaches are to be reconciled I cannot venture to suggest.
	The best summary, if I may say so, was the one which came from the noble Baroness, Lady Hamwee. She said there was a feeling--I take her phrase--that it would be unseemly to press on with local elections in early May. I think that that feeling was generally expressed in every corner of the House.

Baroness Hamwee: My Lords, I am sorry to interrupt the noble and learned Lord, but, in the conversation which I had with my noble friend, the description "unseemly" in fact applied to the prospect of a general election.

Lord Williams of Mostyn: My Lords, the noble Lord, Lord Burnham, invites me to talk my way out of that one--and, accordingly, I shall. The phrase struck my mind as being equally appropriate for the concerns and problems that people have about local elections.
	The noble Baroness asked about the compensation scheme. I can give an undertaking on behalf of the Home Secretary that there will be consultation with parties on the form of the scheme. She asked for a specific undertaking that the compensation scheme is not intended to be used for candidates. I give that undertaking.
	The noble Baroness asked whether Clause 1(3) should be in the Bill or in the principal area rules. She asked a linked question--it came at the same time--about whether the Bill extends to town and parish councils. The advice that we have is that the changes need to be made in primary legislation. The answer to the second question is yes. She further asked a point of detail about the term of members of police and fire authorities. Her question was whether the change applied at both ends. The answer is yes.
	I am seeking to go through my response in the order in which the questions were put. The noble Baroness, Lady Young, introduced a question--which was further developed by both the noble Lord, Lord Norton of Louth, and the noble Lord, Lord Biffen--about whether or not we were in danger of overlooking the constitutional consequences. That was developed further--in particular by the noble Lord, Lord Rennard, from the Liberal Democrat Benches--into a question of whether or not we should have a written constitution and whether or not there should be entrenched mechanisms to prevent elections being postponed. That is an interesting debate for another day or days. I expect that we shall return to it.
	The fact that I respond in that way does not mean that I undervalue the debate. Local elections are in a different position from general elections in terms of flexibility. I do not know which constitutions abroad have entrenched provisions about local elections. I think that the noble Lord, Lord Rennard, may want to offer the answer that if we had a written constitution--if we wished to go down that route--we could accommodate particular provisions about local elections.
	It is an important step. We should not overlook the fact that local democracy is an important constituent of our national life and democracy. I take the point that, simply because this is a one month delay, we should not say that it does not really matter. It is fair to say that any objective reader of our debate today would not be able to conclude that we had rushed at this issue without looking at the more fundamental questions.
	The question of expatriate voters was put to me by the noble Baroness, Lady Young. The position is that returning officers will have been able to advise anyone asking for guidance that 12th March was the cut-off date for the election on 3rd May. The next target--to get on the register to be published by 1st May--was today. If intending voters are not registered now, they would not have been registered for 3rd May in any event.

Baroness Young: My Lords, I am sorry to interrupt the noble and learned Lord, but perhaps I may ask for clarification. He gave the date when overseas voters had to register; it clearly has moved from March to the May date. Can it not move further now that the elections are to be in June? That was really my concern.

Lord Williams of Mostyn: My Lords, I am dealing with the present state of the law. I shall certainly take on board the noble Baroness's question, but plainly, as things presently stand, I have no authority--however much I would wish to have it--to simply by diktat alter the law of this country.
	The noble Baroness also raised a question about educational institutes. Of course we expect returning officers to be sensitive in their choice of polling stations. I shall allow myself a very modest tease in the spirit of harmony that has informed our debate. The general elections in 1983 and in 1987 both took place in June, I believe, at the imperious command of the then Prime Minister, who, I believe, was the noble Baroness, Lady Thatcher.
	The noble Lord, Lord Smith of Clifton, raised a number of questions. I believe that he had been courteous enough to give advance notice. I have all the answers, which I can repeat, but it may be more convenient to your Lordships if they are written. I was very grateful that those detailed questions had been notified to officials in advance.
	I do not want to sound patronising--it is the last thing I have in mind--but I found the speech and contributions of the noble Lord, Lord Norton of Louth, extremely important, as they would have been even had they been free-standing and quite apart from our present debate. Much of what he said resonates with all of us--it certainly resonates in my mind--and it is very important that one should not simply fix one's glance on the pavement of our present details. One should cast one's mind wider and more reflectively, as the noble Lord has done.
	The noble Lord asked whether or not we had looked at other options. Yes. We considered the matter--this is a reply to the noble Lord, Lord Cope of Berkeley, although it may not be a perfectly satisfactory answer to its recipient--and we came to the conclusion that to defer elections for a month and to set a firm date was the better, most prudent and wisest course. That is not capable of scientific analysis or defence. As the noble Baroness, Lady Scott, said, it is an issue of a balance of judgment which we conscientiously made.
	I recognise that there are alternatives. I do not believe--I entirely endorse what the noble Baronesses, Lady Hamwee and Lady Scott, said--that it would have been prudent or responsible to have an open-ended postponement. First, that would have been deeply disheartening to those who are affected by the foot and mouth outbreak--not just farmers but all those who are engaged in the industry of tourism, which is so critically important to the economy and to the life of the nation. To continue the uncertainty would have been a deeply irresponsible course to take. That is the conclusion that we came to, having, of course, considered the possible options.
	I have dealt with the question of compensation. The noble Lord, Lord Rennard, deployed his ammunition on a much wider front and I hope that I have dealt with his queries on the basis that they are general ones. They are important, but they relate to a wider issue and are not specific to this debate.
	I am familiar with the argument about fixed terms. In my experience it is normally deployed by opposition parties and is indignantly rejected by those in government--as we happily are at present. That is not a perfectly purist approach to constitutional matters, but it seems to be the experience of us all.
	The noble Lord, Lord Greaves, asked why the pending by-election in Islington was being postponed. The answer is that we have to treat Greater London as a single entity. It certainly surprised me to learn that there are over 380 farms in London, including over 100 where livestock are kept.
	The noble Lord asked about the inspection of nomination papers and consents. Again, I hope that that will be included in the compendious reply. The noble Lord nods. I am most grateful to him for his courtesy in indicating that he is content with that.
	The noble Lord also asked a specific question about postal votes; namely, where is the proposition to be found in the Bill that postal votes for 3rd May will be transferred to 7th June? The Bill is not required to make that point explicit. Those who have applied for a postal vote for 3rd May will be entitled to use it on 7th June, because it will be for the same election, although that election has been postponed.
	The noble Lord, Lord Greaves, invited my answer to the question: which version of the electoral register will apply to nomination papers; will there be a new version of the principal areas rule? The Bill provides that any nomination that was valid for 3rd May on the basis of the register then in force will be valid for 7th June. My advice is that a new version of the principal areas rule is not required.
	A question was posed about the census. Census takers working in the countryside have been instructed to respect all appropriate restrictions and to respect the wishes of the farming community. Arrangements on a practical basis will be made specific to the census rather than to participation in an election.
	The noble Viscount, Lord Goschen, asked about the closing date for nominations on 10th May. It is based on the normal election timetable. I did not know this, but I am happy to share with the House my newly acquired knowledge that 10th May is the 19th working day before polling day and, working backwards, one gets that terminal.
	The noble Viscount asked why we intend to compensate only independents. The decision was the result of consultation with all the main opposition parties. Although that is not binding on the noble Viscount himself, it was agreed by representatives of his party.

Viscount Goschen: My Lords, I am grateful to the noble and learned Lord for addressing the point. I was not concerned with whether or not that should be done. My point related to whether there was a danger of discriminatory practice in compensating some and not others.

Lord Williams of Mostyn: My Lords, that is a fair question. My answer is that not all discrimination is wrong, providing that it is discreet and justifiable--and approved by the Conservative Party.
	We have yet to finalise the details of the scheme to compensate local authorities for additional electoral expenditure. What we are doing is meeting additional legitimate expenditure consequential--I stress this point--to the postponement, and not expenditure which may derive from other consequences of the foot and mouth outbreak. I hope that we shall be able to publicise the details before 7th June.
	The noble Lord, Lord Hanningfield, asked about annual meetings. They will take place. I recognise the logistical and practical difficulties specified by the noble Lord; they cannot be argued against. The meetings will take place with reference to the election date. So if the election date is postponed, the period in which the annual meeting is to be held will similarly be postponed. We shall use the order-making power in Clause 7 to delay the timing of annual meetings of police and fire authorities.
	My noble friend Lord Fitt asked a number of questions about Northern Ireland. As always, my noble friend speaks with authority about issues that have engaged him for so long. We believe that there is no reason for Northern Ireland to remain separate in its arrangements. Northern Ireland is presently unable to hold local elections coincident with a general election. The Bill contains a provision allowing it to hold local elections and a general election on the same day.
	Your Lordships have assured me, on the basis of the ex cathedra pronouncements in the Sun, that the general election will take place on 7th June. Obviously, I always take on board what is told to me by your Lordships, particularly when it comes from the Sun. I do not know when the general election will be held. I hope that it will be early, so that we shall lay aside any questions of the identity of the next government. But I simply do not know. It is ultimately a matter for the Prime Minister's good judgment. Speaking of which--the noble Lord, Lord Rees-Mogg, is not in his place but he was present earlier--it is worth re-reading a stable companion of the Sun, which is bigger in format and has fewer pictures and longer words; namely, The Times. I can safely paraphrase an extract from the noble Lord's article because, unlike the noble Baroness, Lady Hamwee, he is not here to correct me. He said that if matters were postponed from the anticipated day of 3rd May, that would confirm to him that the Prime Minister was the decent man he had hoped he was four years ago. I leave your Lordships with that thought.
	The noble Baroness, Lady Carnegy, asked about the combined poll. Statistically, the number of spoilt ballot papers in Scotland in 1999 was comparable to the number in an ordinary election in the United Kingdom. The noble Baroness spoke about colours. None of the ballot papers ought to be bright or cheerful in colour, because that would inevitably induce all those voting to vote for the Labour Party. If they were gloomy and funereal, I suppose that would attract the Conservative element such as it presently remains.

Baroness Carnegy of Lour: My Lords--

Lord Williams of Mostyn: My Lords, perhaps I may just finish. This is too good to miss--or, as the noble Baroness, Lady Thatcher, said on one occasion, "I am really enjoying this". I should not have said that because it was immediately on her resignation; so I hope that history is not about to repeat itself.
	Ballot papers can be colour-coded--white and possibly lilac. They should not cause the same confusion as I accept may have occurred on the previous occasion. If--I am told magisterially--someone puts the wrong paper in the wrong box, it will be reconciled to the correct box before the count.

Baroness Carnegy of Lour: My Lords, the statement was in the Bill. It is quite correct, and that was done. The question of spoilt ballot papers is not completely relevant. The question is whether people voted for someone for whom they did not mean to vote--that is, they voted for one of the bodies because they believed they had to vote in the same way for both. That was my question. That needs to be made plain somewhere, not necessarily in the Bill.

Lord Williams of Mostyn: My Lords, I shall certainly take on board that suggestion. If it can be done without legislative means, plainly it needs to be looked at carefully.
	I have only a few seconds more because I am in the 20th minute of my response. I simply want to repeat the fact that this has been a high-quality debate. The briefing note always tells one to say that, and your Lordships will know that I never do. It was a very good debate. It would be helpful to those who sometimes scoff at the nature of the parliamentary process and do not recognise the virtue and continuing value of this House if they were to read it. What was lacking--or almost lacking--was a partisan approach to what we all know is a national problem. It is not of our choosing or of our making. I commend the Bill to the House.
	On Question, Bill read a second time, and committed to a Committee of the Whole House.

Railtrack

Lord Beaumont of Whitley: rose to ask Her Majesty's Government what plans they have, in the light of recent events and of public opinion, to nationalise Railtrack.
	My Lords, the Railways Act 1993 broke British Rail into 100 companies and sold them off. Originally, Railtrack was to be kept in state ownership, but that, too, was sold in 1996 for about £2 billion. The privatised rail companies paid about £5 billion for the whole of BR at privatisation--that is, all the real estate, rolling stock, and so on. They have now received more than that in subsidy, so the railways were effectively given away.
	However, a number of people were opposed to such developments at the time: the Green Party objected to rail privatisation and the fragmentation of the industry; the Labour Party also objected to it. Consensus for Change--the Labour Party's transport strategy for the 21st century--published in 1996, said:
	"The Labour Party is deeply opposed to rail privatisation, as is the British public. It is clear to all serious analysts that (Conservative) government policy is driven by an ideological commitment to privatisation at any price, rather than a proper consideration of the national interest and the country's long-term transport needs. Labour is committed to a publicly owned and publicly accountable railway.
	"The most outrageous sale is that of Railtrack. When the (Conservative) government brought the railways Bill to the House of Commons it promised that Railtrack would remain a publicly owned company 'for the foreseeable future'.
	"On coming to office Labour will set in place a structured programme to return the railways to an integrated whole.
	"As well as the powers of regulation and of subsidy, a Labour government will use its powers to acquire ownership of Railtrack".
	That was the Labour Party view just five years ago. It is still the view of the Green Party, which confirmed its policy of taking the railways back into public ownership at its spring conference last month.
	Rail privatisation has been a dismal failure. Railtrack has failed to maintain the network or to improve it. Safety and performance have both declined. The terrible accidents at Ladbroke Grove and Hatfield were caused by faults with the track and signalling, which are the responsibility of Railtrack. There was chaos after Hatfield, when Railtrack realised that it did not know the state of its network because it subcontracts inspection and maintenance work. It then imposed 1,000 speed restrictions. Timetables were abandoned, fewer trains ran; and those that did run were severely delayed. Even now, six months later, some services are still not back to normal. Sir Alastair Morton, the chair of the Strategic Rail Authority, described it as "a nervous breakdown" for the railways.
	Performance was falling before the Hatfield accident. The latest edition of On Track, Rail Performance Trends published by the SRA compares the first half of 2000-01 with the first half of 1999-2000. The performance of 22 train operating companies declined, two stayed the same and only one improved. The latest figures for October to December 2000 show a 20 per cent fall in performance post Hatfield, and a record number of complaints. Today we heard the announcement regarding the Virgin rail price rises.
	The number of broken rails has increased in the past two years, and Railtrack has failed to expand the network or increase its capacity to meet increased demand. Rail services, both passenger and freight, have collapsed. People and goods are transferring to other less safe and more environmentally damaging modes of transport, such as road and air.
	The sixth report of the Commons Select Committee on Environment, Transport and Regional Affairs, which was published on 29th March of this year, concluded that,
	"the system of managing contractors who carry out maintenance and renewal work on the railway through the system of 'cascaded safety cases' has been shown to have utterly failed. It is not just the system that has failed: Railtrack's management of its contractors has been woeful ... Railtrack told us that the objective of privatisation was 'to maximise proceeds to the Treasury and minimise future subsidy requirements ... There was no vision of the size and type of railway the country needed'.
	The committee continued:
	"The Rail Regulator agreed with Railtrack's assessment. He told us that the 'ill-thought through' financial framework put in place at the time of privatisation was deficient, did little to promote investment, and that there was 'no specification of what Railtrack had to do for the access charges which it receives and very little was done ... to encourage the making of investment".
	I think we can conclude that members of that committee thought that the present system was unsatisfactory.
	Railtrack is not a conventional plc; it is a monopoly. It supplies an essential service so it cannot be allowed to cease operating. The Government will bail it out and the Stock Exchange knows this. Until last week the share price was artificially buoyed up by this knowledge. Privatisation was meant to transfer the financial risk, as well as the profit, to the private sector. However, it has not worked out that way. The private sector has been quite happy to take the profits in the form of dividends, share options and high salaries. But whenever there are financial losses it comes to the Government with it begging bowl and asks to be bailed out, as happened with the West Coast route modernisation and, again, this week for network maintenance.
	The Transport Act 2000 set up the Strategic Rail Authority, which came into formal existence on 1st February of this year. However, it had been operating as a shadow authority since 1999. It has not yet produced a strategy; it has just produced a strategic agenda. The actual strategic plan is to follow in the autumn. The Government published the 10-year transport plan last year. This included £60 billion of investment in rail of which £26 billion is to come from the Government. Most of that will end up with Railtrack, either directly or indirectly via the train operating companies.
	At the Institute for Public Policy Research's Rail Renaissance conference in February, the Minister who is to respond to this debate, Sir Alastair Morton, the chair of the SRA, and Tom Winsor, the Rail Regulator, all spoke of a consensus that the railways should not be re-structured, and said that we should work within the present system. It took the Green Party's transport speaker, Mr Alan Francis, to point out that that consensus did not extend to rail passengers--the vast majority of whom wanted the railways to be renationalised. While many in the audience agreed with Mr Francis, he was then rounded on by Mr Winsor who claimed that the services that the public wants can be more effectively operated in the public interest by the private sector. If that is so, why has it not happened over the past five years?
	A privatised Railtrack achieves the worst of both worlds: it is neither accountable to the public as a public rail service should be, nor is it delivering better standards in the way that privatised services are supposed to do in theory. Rail privatisation was Thatcherite dogma take to extremes. New Labour has lacked the courage to renationalise, yet has also failed to ensure the proper standards of service. General public opinion is now very much in favour of renationalisation, as evidenced by public polls and by the tabling of an Early Day Motion in another place.
	Moreover, the sixth report of the Commons Select Committee on the Environment, Transport and Regional Affairs, which was published last week, also said:
	"Given that the previous means of managing maintenance and renewal contractors has failed, we strongly recommend that Railtrack take over direct responsibility for inspecting the network".
	The committee also recommended that the public should have a stake in Railtrack in exchange for its investment. The City's reaction to Monday's imposition of a director to represent the public interest on the Railtrack board shows that partial renationalisation is not a realistic option. Railtrack has either to be in the private sector or in the public sector; it cannot be in both.
	The cost of renationalisation would be in the region of £2.5 billion, which could be phased in over a number of years by the issue of bonds. Railtrack is being given £3.5 billion just to upgrade the West Coast Main Line, why not pay the extra and get the whole lot?
	There are a number of models that could be used to bring back Railtrack into public ownership. In the longer term as passenger franchises expire they could be brought back into the public sector at no cost. Ultimately the rolling stock could also be brought back. That would cost in the region of £2 billion to £3 billion. Meanwhile the situation would be a bit like that with London buses. The infrastructure would be publicly owned with operation under the control of a public authority.
	The Green Party has drafted a short Bill to allow the Government to take Railtrack back into public ownership. Because it involves expenditure on compensation for shareholders I was advised by the Clerks that only a government Minister can put it forward in another place. Perhaps the noble Lord, Lord Macdonald, who will reply to the debate will volunteer one of his colleagues to do so and he will take charge of it when it comes to this House.

Lord Berkeley: My Lords, I declare an interest as chairman of the Rail Freight Group and as adviser to Adtranz.
	The noble Lord, Lord Beaumont of Whitley, is certainly right to say that the industry is still in a bad way after the Hatfield crash. Rail freight is taking longer to reach its destination and costs are up. Many passenger services are still not running to time. The problem is that the growth in the 10-year plan of 80 and 50 per cent respectively is predicated on a reliable infrastructure. We do not have that and, sadly, the time that is being taken to get back to what might be called reliability seems to become ever longer. I believe that the industry has lost confidence in Railtrack. That in turn puts at risk the private finance in the trains, stations and terminals on which the 10-year plan is largely based.
	There has been good news recently. The Department of Transport and the Strategic Rail Authority made some excellent announcements this week which included more money for Railtrack and a new budget. In that connection I refer to the periodic review of freight and the regulator's conclusions which came out today. They have also persuaded Railtrack to stick to running the network and leave all new enhancements to other organisations. One might say that they have asked Railtrack to stick to its knitting and get the knitting right. The rail regulator has reduced the freight access charges by 50 per cent. That is very welcome. He is also tightening up various new licence conditions which I think will make Railtrack perform much more effectively. That is in addition to the provisions in the Transport Act and the Competition Act.
	However, it is clear that Railtrack has failed in its primary duty to operate and maintain the network. In fact, it does not even know what it owns and operates in the network. I am concerned that it has taken the Hatfield crash and seven years of operation to persuade successive Ministers, OPRAF (as it then was), the SRA and regulators of the problems that have arisen from the privatisation of Railtrack.
	I do not believe that renationalisation is the answer. It might be good to put the assets that we all once owned as taxpayers back into the public sector, but I believe that the problem is one of management. I do not think that one can necessarily argue that a nationalised industry is any more efficient, or even less efficient, than one in the private sector. We can all mention examples--we have done so on many occasions in the Chamber--of different organisations which should or should not be in the private or public sectors. As I say, I believe that the problem is one of management.
	When Gerald Corbett was chief executive of Railtrack he used to say that he had much too much to do and was much too busy. I refer to a failure on the part of the shareholders. Apparently they have not until recently been concerned about the low share price. I believe that the share price is well below £5 today. However, they may be concerned about the tougher regulatory regime of the rail regulator and the SRA.
	One has to ask whether it would be so awful if Railtrack "went bust". The shareholders would suffer, but would the network? That is a question we must ask. There is the possibility in the Transport Act for the SRA to take over Railtrack, or, alternatively, one or more companies could buy it as a going concern. Several noble Lords have said in the past that they thought that the rail regulator had a duty to keep Railtrack solvent. The Railways Act 1993 states that the regulator has a duty,
	"to act in a manner which he considers will not render it unduly difficult for persons who are holders of network licences to finance any activities".
	Railtrack is a holder of a network licence. In my judgment that does not state that the regulator has to keep those activities alive; he just has to take them into account. I believe that Railtrack cannot finance those few activities which the Government are not funding due to poor management and a lack of responsibility towards its shareholders.
	Perhaps it would be better to split Railtrack into several zonal plcs--as I have suggested before--as that would constitute smaller companies that were easier to manage. I am told that that would not require legislation. The "frontier" effects between the zones or the companies would certainly not be any worse than they are at the moment. They are not very good at the moment. In not providing a network fit to fulfil its purpose I believe that Railtrack's board and management are at fault. They are accountable to their shareholders. They are also adversely affecting the private sector finance of the other parts of the network.
	I am pleased that the Transport Act, the Competition Act and the rail regulator are tightening the regime but I hope that the SRA will also appreciate the strategic need to ensure that Railtrack delivers. If that causes Railtrack's shareholders to take action before the share price falls to 50p, or whatever it is likely to be, so be it. If not, the SRA and the rail regulator will have to tighten the screw still further. I believe that it is possible to manage rail infrastructure reliably, effectively and at reasonable cost, as many railway administrations have shown, and are showing, around the world.
	I conclude by emphasising that in my view the transport plan, which I think is a fantastic plan that must be delivered, is at risk unless and until we have in place a network that operates reliably seven days a week and 24 hours a day. I believe that the present structure can deliver that but that Railtrack shareholders will probably have to suffer a great deal more before that happens. I only hope that that occurs rather more quickly than it has done in the past seven years.

Lord Bradshaw: My Lords, I must declare an interest as I am still a member of the Strategic Rail Authority. However, I speak tonight on my own behalf and I say categorically that I do not speak with the support of the Strategic Rail Authority.
	As a professional railway manager, I believe that the idea that one can run a railway with someone running the trains and someone else managing the track is quite foreign to the proper operation of a railway. The origin of the idea was first formed in European Directive 91/440 which stated that railway undertakings should have a separate accounting mechanism for their infrastructure, not a separate management. But somehow in Britain that got translated into the idea that we should divide the two. Most of our European colleagues are incredulous at the system we try to operate in this country.
	I am pleased to note that there are now two Peers on the Conservative Benches. I refer to the book, The Right Lines, by Kenneth Irvine, whom I can only describe as a failed railwayman. He proposes a separate infrastructure business. He has all kinds of strange ideas. He believes, for example, that there can be much competition on the railways and that one can turn up at Waterloo Station and there will be a red train, a blue train and a green train going to Woking and one can choose which train to catch according to which is most comfortable. That is quite foreign to the idea of organising a railway. One cannot run a railway on the basis of many different operators with equipment of different specifications operating a competitive service.
	The original aim was not to privatise Railtrack but to keep it in the public sector. However, that idea was swept away because at that stage many other network industries had been privatised, such as electricity, gas and water. People asked why the railways could not be privatised also. However, if one is selling water, gas or electricity, one sells a homogenous product. Several people can put the same stuff into the pipeline and the same stuff emerges from the other end of the pipeline and can be metered. The problem with railways is that it is the poor passenger who gets stuffed into the pipeline--and often a very poor quality pipeline. They also all have different needs, which are not easily discriminated by the pipeline system through which they tend to get pushed.
	Let me deal with a few myths about the present railway system. The first is that the maintenance problems experienced by the railways somehow had their genesis under British Rail. BR was kept very short of money, but I assure that House that BR's professional engineering standards could not possibly have permitted the deterioration in the network that we have seen. The problems would have been stopped much sooner. In any event, speed restrictions would have been put in place. The professional integrity of all those involved, from the supervisors on the track through to the divisional engineers, was such that the situation could not have arisen.
	The second myth is that the recent growth in passengers has been conjured up by the private companies. The last time that the economy turned up as it has done under the present Government--for which they are entitled to a great deal of credit--carryings on the railway rose steeply. Carryings on the railway are very susceptible to the working of the trade cycle.
	The third myth was that 20 per cent of the costs could be taken out of the industry, which would be a bonus for shareholders, and that at the time of the regulatory review it would be possible for the regulator to pass those benefits on to passengers. In fact, BR had been screwed down so tightly by successive governments that there was not 20 per cent to be got out of the costs, whereas there were opportunities for economy in gas, water and electricity, which were monopoly industries that had not been pushed so hard by government.
	The fourth myth was about open access, which has all but disappeared from the lexicon of people addressing the industry.
	The rolling stock arrangements have been successful. On this point I disagree with the noble Lord, Lord Beaumont of Whitley. It is perfectly feasible for rolling stock to be leased. That is the common way of buying aircraft and buses. I am not sure that people lease ships, but they are mobile assets that generally have many substitute uses. The previous government's stubbornness in not allowing leasing in 1993, when begged to do so by the then British Railways Board, led to the closing down of most of the British railway construction industry.
	Railtrack has been sliding backwards, as other noble Lords have said. It has had advice from American consultants on how to make quick economies to keep the share price up. John Kay wrote a good article in yesterday's Financial Times warning against that practice and the very short-term gains that it brings. He compared Railtrack with Marks and Spencer. The article is well worth reading.
	We have had a generous regulatory review. We have moved forward £1.5 billion of funding to assist Railtrack. The post-Hatfield review will cost a lot, because, while the shareholders will take their hit for some of the compensation, a huge programme of remedial works is necessary. Railtrack has withdrawn from its programme of enhancements and it has the Cullen report to deal with.
	The cost of such work schemes is escalating rapidly. Railtrack does not take risks or provide a robust system. It is a monopoly, which is extraordinarily difficult to regulate when there are no comparators, and it is distant from the end customers. The Government should consider whether we need two regulators--the SRA and the Office of the Rail Regulator, which are both effectively dispensing government funds.
	I come back to where I started. I honestly believe that very soon--perhaps in the refranchising process--we shall put the management of the operation and maintenance of the track back together with the train companies to form proper companies that can answer to their customers for the services that they deliver.

Lord Wallace of Saltaire: My Lords, professionally, I teach public policy, among other things. One of the things that we try to get students to understand is that there are different appropriate frameworks for different areas of public policy. One of the principles of those who teach public policy now is that whatever works best is the framework that is needed--a very new Labour principle.
	We also teach that there is a range of possibilities for the funding, ownership and regulation of natural monopolies. Over the past 15 years we have seen the relatively successful privatisation of electricity, gas and water, each of which was done in a different way. In the water industry we have discovered that, when there are very long-term investments, such as reservoirs, there is often a case for non-profit trusts rather than straightforward shareholder-based companies as the basis of operation. A number of water companies have argued for that. Each method builds in different patterns of incentives, which affect the behaviour of the managers and their customers.
	Railtrack is in a different category from electricity, gas and water. The pattern of incentives built in to the structure has proved perverse because of the unavoidable antagonism between Railtrack and the train operating companies and because of the relationship between Railtrack and its far too many contractors, in which the incentive is to save on costs rather than to promote safety. In a Civil Service magazine that I received today, I came across a quote from evidence given to the Cullen inquiry, which said that in a "fragmented and organisationally incoherent" industry, creating a safety culture across the whole industry workforce was "simply not obtainable". That expressed better than I could the perverse incentives that are built in.
	Secondly, unlike electricity and gas, the rail industry will clearly be dependent for many years on public subsidy for investment. That makes it harder and more expensive to raise additional funds on private markets. Being dependent on public subsidy raises some large questions about accountability. I work in the higher education sector. As ever more detailed inspections by public agencies are imposed on us, we are told that they are justified by the need to provide detailed accountability for public expenditure. I am amazed that similar principles are not imposed on Railtrack. For example, much of the track inspection is left to private contractors. I find the Treasury's ideology on the issue extraordinary. It has not moved on very far in the past 20 years. The problem of accountability is fundamental. Public money is being given as a subsidy to a private company without clear oversight.
	Lastly, the system was designed in a hurry by the Conservatives to cope with decline. Happily, we have found that, rather than decline, we are dealing with the problems of expansion. I live in Yorkshire at the end of the Leeds-Carlisle railway line, much of which was due to be closed 15 years ago but which is now being rapidly expanded to carry additional traffic. As the noble Lord, Lord Faulkner of Worcester, knows, I am an active member and now a shareholder--I must declare that interest--of the Wensleydale railway company, which we hope will enable us to reopen another railway line. I also use the East Coast Main Line--even Leeds railway station on occasions--so I have an active interest in the further expansion and upgrading of the British railways system to cope with the expansion of traffic.
	It is clear that the current structures do not allow for or promote the investment or expansion that we need. For those reasons, they need to be fundamentally changed. The current structure is wrong. Nationalisation may not be the answer, but there is a range of other toolkits--to use the academic expression--such as non-profit trusts and public/private partnerships, which the Government have accepted in other areas. It is time they tried them.

Lord Woolmer of Leeds: My Lords, I am sure that I speak for many in this House in welcoming the Government's announcement on Monday that they will bring forward some £1.5 billion in payments to Railtrack. That should help the company's ability to meet the needs of the existing rail network. I, for one, take it as a sign that the Government are committed to getting the railway industry back into proper shape and to providing passengers with an improved service.
	I agree with other noble Lords that Railtrack has a vital part to play in modernising the railway system. However, it is clear that it needs to concentrate more than it has done in the past on its basic job--that is, making the existing railway network better and safer. I was struck by one quotation that I read earlier this week:
	"Railtrack has in the past been guilty of over-promising and under-delivering, particularly to its customers".
	Those are the words of Steve Marshall, Railtrack's Chief Executive. I suspect that few in this House would disagree with him.
	However, words on their own are not enough, and action is required if passenger confidence is to be repaired. That is why I welcome not only the monetary elements of Monday's announcements, important though they are; the non-monetary elements of the package are as, if not more, important.
	First, Railtrack must focus on its core responsibility for the existing network and on meeting the needs of the train operators. At times in the early days, I formed the impression that Railtrack was a property company rather than a rail track company. It had poor project management skills and at one time appeared to be placing profits before investment.
	Now, it will no longer have a monopoly on the major projects required to enhance the network as part of the 10-Year Plan. I welcome the fact that other companies can now join in with new public/private partnerships to take forward those projects, starting with the upgrade of the East Coast Main Line, to which--here, I declare an interest as a regular user--I look forward very warmly. Greater concentration on the stewardship of its existing assets will assist Railtrack to achieve more effective operation, maintenance and renewal of the network.
	As I understand it, the Statement of Principles agreed between the Government and Railtrack sets out and formalises the relationship between the two parties. The statement recognises Railtrack's unique role as a public company which provides an important public service and attracts public funding. Given that background, Railtrack has agreed to appoint a non-executive director to its main board with a specific remit to provide a powerful public and consumer voice on the board.
	I hope that the first part of Railtrack's 2001 network management statement--due, I believe, in May and covering the existing railway--will address its asset stewardship obligations. I should be grateful if the Minister would confirm that the statement will make clear how the company will deliver effective management of contracted-out work, how it will deliver consistency and customer focus across its activities, and how it will reinforce its engineering skills base.
	It is important that all moneys brought forward are spent on the railway industry. Noble Lords will have noted that Railtrack capitalisation is now down to £2.5 billion. That puts into context the bringing forward of a further £1.5 billion in public funds. Clearly it is important that Railtrack uses that money by investing it in the railway system and that it does not use it for the immediate or shorter-term benefit of shareholders.
	I am in no doubt that many of the problems that we have seen in recent years can be laid at three doors. First, chronic under-investment in the railway industry took place under successive Conservative governments in the 1980s and 1990s. Under nationalisation, there was also a lack of incentives for better performance.
	Secondly, the railway industry was restructured in the mid-1990s in a rushed and disastrous manner and then privatised. It was restructured into 25 train operating companies, five freight operators, three rolling-stock leasing companies, 19 maintenance suppliers and Railtrack.
	Thirdly, as I said earlier, since privatisation, Railtrack has appeared at times to be driven by its property interests and, at other times, to be driven first and foremost by the desire to make profits rather than to invest. It has shown lamentable project management and management skills. Operationally, it has been poor at its job.
	However, I do not conclude that the answer is to return to nationalisation. I believe that that type of gut reaction takes us nowhere. Perhaps I may suggest to my noble friend the Minister that the railway industry now needs a period of stability. I believe that the Government are addressing the right issues: they are increasing investment in the rail industry with some £30 billion over the next 10 years; they are addressing the question of strong project management and construction skills; and they are bringing new companies into public/private partnerships to deal with future major projects. Railtrack can now concentrate on its core business of looking after its existing network and doing that properly and efficiently.
	The industry now needs a period of certainty and stability in order to get things right. If it does not do so, I shall be among the first to say that further change must take place. However, let us now get investment into the railway industry; let it have a period of stability; and let it show collectively that it can meet the challenge of providing a good public transport service.

Lord Greaves: My Lords, I thank the noble Lord, Lord Beaumont of Whitley, for introducing this debate. I profess to feeling a certain degree of intimidation--or perhaps not intimidation, but something similar--at the professional and academic expertise which certainly my noble friends who sit in front of me have brought to this debate.
	I started my life-long interest in railways approximately 50 years ago when, one Christmas, I received a first edition of Thomas the Tank Engine in a parcel from Santa Claus. As a book dealer, I very much regret that I do not still own that first edition. My mother gave it away to the local hospital with a load of Eagle annuals and other things, which I also regret I no longer own.
	From a childhood enlivened by the Reverend W Awdry's books, I remember the wonderful character of the Fat Controller. He was a bureaucrat; he was a man with a hat; and he was derided by the people who really ran the railway--who, in those stories, were the engines--for not knowing much about rail engineering. It sounds a little like Railtrack.
	Nowadays, we have the Rail Regulator; we have the Strategic Rail Authority and its chairman; we have Her Majesty's Railway Inspectorate, which I believe is now part of the Health and Safety Executive; we have the Secretary of State; we have Railtrack and its own Fat Controller; we have the train operating companies with all their Fat Controllers, including the rail freight companies; and, of course--a matter about which we should be very pleased in your Lordships' House--we have the Minister. I do not by any means suggest that the Minister is a Fat Controller; he is far too lean and hungry.
	However, a question that people ask time and time again in relation to the railway industry in this country is: who is the Fat Controller? Who is in charge? Where does the buck stop? The truth is that no one knows. Until that matter is sorted out, or, at least, until our incredibly fragmented railway system is de-fragmented to some degree, I do not believe that we shall make a great deal of progress.
	At the time of rail nationalisation--I am sorry, I mean rail privatisation; I do not remember making speeches at the time of rail nationalisation as I was reading Thomas the Tank Engine then--I can remember making a speech in another place altogether: Lancashire County Council. During that speech I asked how long it would be before one heard announcements by the train operating companies saying, "Hello, this is Sharon, your assistant passenger supervisor. We are very sorry that this train is delayed by half an hour (or two hours). Unfortunately, this is due to the incompetence of Railtrack, which is responsible for looking after the track and signals and can't do it very well".
	At that time, people said that I was going over the top. However, since then, over several years Railtrack has engaged in squeezing the assets and the staff of the railway industry in the short-term interests of its shareholders, including its directors. That is a fair description of what has happened. Lo and behold, I now find that the train operating companies and Railtrack are indeed in open warfare. My prediction those many years ago has come true.
	Today's Independent quotes Mr Chris Green, who is one of the more respected railway managers in this country and who is now chief executive of Virgin Trains. I regard that as a hopeful feature of today's railway system. He is also a senior official with the Association of Train Operating Companies. In his attempt to defend the indefensible--Virgin's announcement of a 10 per cent increase in rail fares--he is quoted as saying:
	"Before the Hatfield disaster last October the industry was on target for another year of growth and investment. By November the rail network had been decimated by its own foot-and-mouth disease in the shape of 500 emergency speed restrictions, which wiped out four years of growth in four weeks".
	Virgin and some other train operating companies are reported to be about to take Railtrack to court over an argument about compensation for the losses that they have suffered since Hatfield. We have a rail system that is fragmented and in which the fragmented elements are taking each other to court. That is a recipe for disaster.
	The public are aware that Railtrack's share value has gone down by 30 per cent or 35 per cent during the past three days--I do not know what happened today--and that its value is rapidly approaching £2 billion or less. It is said to have physical assets worth about £5 billion, although I am not sure how anyone knows that. Railtrack clearly does not know exactly what its assets are--its asset database is inadequate, to put it mildly.
	The Government are bailing out Railtrack in the short term with £1.5 billion. People ask, quite reasonably, why the Government are giving that money to a private sector firm that will simply return the money to its shareholders when it starts to make a profit again.
	I accept, as noble Lords have already said, that the problem may not be one of ownership per se. However, the need for profit is at the heart of the problem. My noble friend Lord Wallace of Saltaire discussed the fact that a series of options is available, ranging from the use of trusts to the establishment of a non-profit making company; other options are also involved. I do not consider myself to be an expert in that regard.
	Simply putting a public interest director on Railtrack's board is not an answer to the problem. I do not know who will be appointed but I notice that the noble Lord, Lord Faulkner of Worcester, is poised to jump up. I read in the newspaper that he might be appointed. I notice that he is shaking his head--he is very wise. If he has been offered the post and has already turned it down, he is an even wiser person. The position will be a poisoned chalice. All the Fat Controllers in the fragmented railway industry, Government Ministers and Railtrack's directors will pass the buck to that person and ensure that next time the railways fall to bits, he will have to answer on television, in newspapers and elsewhere.
	Whatever the answer in this context, we have to consider re-nationalising Railtrack or making it a non-profit making organisation with clear duties that is accountable to the public, through Parliament and the government, and to its customers--that is, the train operating companies, including the freight companies. Such solutions will have to be considered because the Government's present approach is simply to pour more and more taxpayers' money into a company that is responsible to its shareholders.

Lord Faulkner of Worcester: My Lords, I had intended to start by congratulating the noble Lord, Lord Beaumont of Whitley, on his immaculate sense of timing. He initiated this debate on the day that the media are full of reports about plans by Virgin to increase fares, apparently by 9.8 per cent from next month. As the noble Lord, Lord Greaves, reminded us, that announcement was accompanied by a comment from Chris Green, who said that the increase was a direct consequence of Railtrack's refusal to compensate the train operating companies adequately for the delays caused by the speed restrictions that have been imposed since the Hatfield crash.
	Then it occurred to me that scarcely a day has passed since the Hatfield crash in which there has not been critical press comment of Railtrack's performance. Consider the leader in today's Guardian, which states:
	"Rail privatisation, predictably, has turned out to be an operational disaster. But it is also turning into a serious financial disaster, since neither Railtrack nor the operating companies can reconcile the requirement to invest heavily to build a modern railway (such as continental countries have enjoyed for years) with the need to make profits and dividends for shareholders".
	None of that comes as a surprise to those of us who worked in the industry before privatisation. The noble Lord, Lord Bradshaw, and I share the distinction of having that on our CVs. It was apparent at the time of privatisation that a political agenda was driving the timetable. The desperation of getting the whole industry irreversibly into the private sector before the 1997 election overrode every other consideration, including considerations about what made sense in strategic transport terms, about whether the taxpayer would get value for money and about whether passengers had any hope of getting a better deal.
	The Public Accounts Committee in another place concluded in August last year that:
	"Railtrack's licence at privatisation contained serious shortcomings because of haste in privatising Railtrack and, as a result, passengers have seen poorer track quality, weak contracts between Railtrack and train operators, and possibly unjustified performance bonuses to Railtrack. We are concerned that this haste contributed to serious deficiencies in the subsequent regulatory regime".
	That report came out just two months before the Hatfield crash. It also pointed out that when in 1994 the then Department of Transport licensed Railtrack to operate the network, the intention was that the company would remain in the public sector for at least some time. The noble Lord, Lord Bradshaw, made that point. The question that the noble Lord, Lord Beaumont of Whitley, raises is both pertinent and timely.
	Had things remained as they were during the first years after privatisation, when Railtrack was left to behave as it wished--it was largely unaccountable, insensitive to the needs of passengers and train operators alike, careless in its observance of its licence obligations and able to abuse its monopoly position--and when the regulator was forced to be little more than a frustrated bystander, one could understand how re-nationalisation could be seen as the only way out of the mess, despite the further upheaval that that would create. Thus far I have sympathy with the points made by the noble Lord, Lord Beaumont.
	However, things have changed. My noble friend Lord Macdonald of Tradeston and the Deputy Prime Minister deserve great credit for at last getting a grip on those incredibly difficult issues, particularly in relation to the way in which Railtrack is regulated. The new Rail Regulator, Mr Tom Winsor, also deserves such credit.
	The new agenda for Railtrack that was announced by the Deputy Prime Minister on Monday was discussed by my noble friend Lord Woolmer. It attached strict conditions, including more accountability and tougher regulation in the public interest in return for the accelerated payment to the company of £1.5 billion, which was due to Railtrack under the rail regulator's review of its access charges. That establishes the crucial elements of the financial structure that was needed by the rail industry to maintain the momentum of the Government's 10-year plan for transport.
	Central to the success of that policy is the role of the regulator. He has to monitor Railtrack's performance regime, network stewardship and investment plans. He knows that Railtrack must meet the needs and expectations of the public and the industry by treating their public interest obligations as seriously as it treats its commercial responsibilities. He and the Government will be able to put pressure on the company to ensure that the network is maintained, renewed and enhanced in a manner that meets the requirements of all its customers.
	The Rail Regulator's role is that of an enforcer and of an architect--he has to build a regulatory structure that will give each player in the industry the right incentives to contribute to the growth of investment, which underpins the Government's integrated transport strategy. Indeed, he did that today with his announcement of the 50 per cent cut in freight charges. That will play a large part in helping the Government to meet their target of increasing freight carried by rail by 80 per cent.
	The regulator is there to rectify the shortcomings that were built into the regulatory system during privatisation. He inherited a toolbox which was pretty well stocked, but many of the items in that box were covered in dust and cobwebs. He has got those items into working order and added to them as well.
	His reform programme is nearing completion. He delivered an extended and rigorous periodic review and the problems, the potential solutions and improved incentives are now better defined for Railtrack than at any since privatisation. What matters is not who owns the assets but whether and to what extent those assets are operated in a way which promotes and protects the public interest.
	It is therefore regrettable that Mr Winsor continues to be the target of unpleasant and ill-informed sniping by the Conservative transport spokesman in another place--I absolve absolutely those who have spoken on transport for the Conservatives in this House and indeed am looking forward to the speech of the noble Baroness, Lady Hanham, who is making her debut on transport in this debate.
	The new Transport Act has strengthened the powers available to the regulator, and he must keep up the pressure on Railtrack to specify clearly what it will deliver in terms of performance, stewardship of the network and investment. Surely it is more sensible to see how this new approach works out before we plunge into the turmoil of yet another reorganisation of our railways. It must be right to give the Government's attempt to create a partnership between the public and private sectors, backed by firm, independent regulation, a chance to see whether it can deliver a railway of which again we can be proud.

Baroness Thomas of Walliswood: My Lords, we are all grateful for the opportunity given to us by the noble Lord, Lord Beaumont of Whitley, with whom I remember campaigning many years ago and have known as a cherished colleague over those years. We have been lucky to hear some excellent speeches in the debate he provided for us tonight.
	I am grateful also to those who have spoken from my Back Benches who have each, in their own way, added a particular apercou to our discussions. I am sorry, in welcoming the noble Baroness, Lady Hanham, to her new temporary responsibilities, that she is not supported by any Back-Bench speakers from the Tory Benches. That is a very strange omission.
	The noble Lord, Lord Beaumont, gave us a vivid account of the things that have gone wrong with the railway. I am sure most of us agree with many of his criticisms. One of the basic flaws in the system is contained in the contradictory role of the Rail Regulator. In that regard I take issue with the noble Lord, Lord Faulkner of Worcester. The Rail Regulator is required, under the rail privatisation Act, to maintain Railtrack's abilities to finance its functions. But the regulator also has the power and duty to punish breaches of Railtrack's licence conditions with fines. As a result, in effect, the taxpayer is continually being asked to pay the company's fines because more and more money is drawn into Railtrack by various means. Otherwise Railtrack could be rendered unable to carry out the work which the Strategic Rail Authority requires it to undertake.
	Again, the reduced freight access charges are to be welcomed from the point of view of public policy. But what will be the effect on Railtrack's finances? Will it be tempted not to increase the availability of track because it is not going to obtain enough money for it? There are a whole lot of arguments built into these matters of finance.

Lord Faulkner of Worcester: My Lords, I thank the noble Baroness for giving way. I can answer that question. The press release from the regulator says,
	"The reduction in charges does not affect Railtrack because the lower revenues will be made up by higher subventions from public funds. At the least, this change is cost-neutral to Railtrack, and it has the upside of higher freight volumes and therefore higher revenues in the longer term".

Baroness Thomas of Walliswood: My Lords, the noble Lord has just made my point. My point was that the deficits in Railtrack are being made up from the public purse.
	Moreover, Railtrack's proposals for major improvements, such as the West Coast Main Line and Thameslink, are progressing at a snail's pace, whereas the costs are rising dramatically--in the case of the West Coast Main Line by nearly three times from £2.5 billion to £6 billion. That must put into doubt its ability, without even more increases in funding, to implement what are likely to be the Cullen recommendations.
	It is also a question of whether we are going to get value from the money that the public puts in for the work that needs to be done in the public interest. At the time of privatisation Liberal Democrats wanted to retain Railtrack within the public sector, which would have prevented some of the current problems. In particular, it might have avoided the loss of robust management and maintenance systems for the track and signals--something to which my noble friend Lord Bradshaw referred, and the lack of which has been so evident in the recent past.
	Most of the railwaymen I have met would have preferred--if we were going to go ahead at all with privatisation--not to cut the cake in tiers, but to cut it in slices, retaining management of the track and of the services in the same hands. That would have avoided some of the difficulties in obtaining access to the track in order to carry out essential repairs at Hatfield--a matter dealt with extremely interestingly in a series of articles by Ian Jacks recently in the Guardian.
	But re-nationalisation carries enormous problems with it. I shall speak about costs in a moment. There is of course a financial cost involved. But even more difficult is the disruption that it would cause. We already have a demoralised industry. We already have a public who have completely lost confidence in that industry. To go through a whole legislative process of re-nationalisation would merely exacerbate those two dangerous aspects. We must remind ourselves that, for public policy reasons, we desperately need the railways to be successful.
	What are the other alternatives? In February of this year the Liberal Democrats published a paper on its policies for safe, reliable and affordable rail travel. We proposed establishing a sustainable transport authority to take over the functions of both the Strategic Rail Authority and the rail regulator. We hoped that that would simplify the current bureaucratic system of incentives and penalties which tend to work against each other.
	A second major proposal was to create a not-for-profit public interest Railtrack company to run the railway infrastructure. That has been referred to in various ways by several speakers. Such a company would not be restricted in the way that publicly-owned companies are--in my view, quite irrationally--from making appeals to the private sector. It would be likely to finance its work through bonds attracting a lower rate of interest. The sustainable transport authority would use its powers to reduce the number of franchises and to encourage Railtrack to pass its responsibilities for infrastructure renewal and repair to the major train operating companies.
	The fourth proposal was to implement the expected recommendations of the Cullen inquiry and to create a new independent body to regulate rail safety together with a separate accident investigation body, modelled on the Air Accident Investigation Branch. Those two things would give passengers greater confidence that the whole safety issue is in independent hands.
	The situation is moving extremely rapidly. There has been a new intervention by the Strategic Rail Authority. The question arises as to whether Railtrack would have the financial circumstances to make even our proposals viable. I believe that the noble Lord, Lord Berkeley, suggested that it may be an advantage to allow Railtrack to go bankrupt. I look forward, with some interest, to hearing the Minister's response to that suggestion, which has some tempting aspects.
	The Government have also set their mind against taking Railtrack back into public ownership, while at the same time having to deal with the current situation. If the rail system cannot be publicly owned, somehow it must be made to work in its present form. Therefore, I have some questions for the Minister. How do they propose to re-establish a successful public sector influence over such an important public service and to make it work, not under an airy-fairy scheme, but in practice for freight and passenger customers? Given that no new franchises have yet been signed, will the Minister consider the option of some of the larger franchises, such as South West Trains or ScotRail, taking on responsibility for the maintenance, renewal and enhancement of the track and signalling as part of their new franchises. That would re-establish the link between the wheel and the rail that so many people in the industry believe is an essential pre-requisite for a well-managed railway.
	Today we have considered the catastrophic aftermath of a disastrous Conservative policy. It is clear that if this Labour Government prove unable to take charge of, to protect and to promote the public interest in the railways, the clamour for renationalisation, however mistaken, will become politically irresistible.

Baroness Hanham: My Lords, I join other noble Lords in thanking the noble Lord, Lord Beaumont, for introducing this debate. I appear on the Front Bench in a temporary role, but I am here and I thank noble Lords for noticing that I am here, even if more or less alone.
	A number of serious contributions to this debate have been made by people who have considerable experience in the area of transport. I speak with some trepidation after the noble Lords, Lord Berkeley, Lord Bradshaw and Lord Faulkner, all of whom have been at the coal-face of the industry and have knowledge of it.
	Having listened most carefully to the debate, I do not believe that any of the speakers have demonstrated, or wanted to demonstrate, as the Question promulgates, any reason for or realistic prospect of the railways returning to their pre-privatisation days. Indeed, how could they, as even the most prejudiced views would have to accept that privatisation has brought, and has the prospect of bringing, singular advantages to the rail industry.
	Although an interest in historic matters is not necessarily part of this Government's thinking, no sensible person who remembers the days prior to privatisation would in reality want to return to them. We must admit that trains were over-crowded, late and dirty. That was part of the daily routine. Casting my mind back, I remember frequent journeys to the North of England where to be 25 minutes late was to be on time and to be an hour late was par for the course.
	Investment was not sufficient to bring about the modernisation and increased capacity which has become part and parcel of the present service; nor could it be because the only source was the Treasury. It is perhaps worth remembering that it was against the background of the previous 40 years--I am looking back to the 1950s--of disastrous reductions in passenger journeys (between 1952 and 1992 they fell from 17 per cent to just 5 per cent) and of a reduction in goods moved by rail (from 42 per cent to 7 per cent) that the Conservative government took the decision to undertake the privatisation programme.
	Privatisation, or some of it, has been criticised, such as the creation of a number of separate companies to run different aspects of the service and, specifically, the creation of Railtrack. After decades of decline, privatisation has brought the opportunity of investment, modernisation and innovation, particularly to the train operators. Passenger numbers have increased and, until the most recent problems with broken rails, disastrous rail crashes, the massive programme of repair instigated by the Government and carried out at break-neck speed, which is not yet completed, and which has brought endless disruption to rail journeys, performance was generally well above pre-privatisation days.
	The fact that that work had to be carried out is no reason for suggesting that the railways should be renationalised. Even these days, when the Government appear to be able to conjure capital from the Treasury like a rabbit from a hat, the cost of doing so, as well as taking the whole burden of investment on to the tax revenues, which will surely cease to be inexhaustible, would relegate the railways to their previous capital-starved state.
	The danger of all the mechanisms that the Government have now put in place, in particular in the recent Transport Act, by giving Ministers substantial new powers and creating the overarching Strategic Rail Authority, is that even without renationalisation, the initiative and ideas of the industry will be stifled, and private investment, which is so badly needed, will be jeopardised by over-centralisation.
	The new chairman of the Strategic Rail Authority has, if I may put it so, a good track record. However, it is in the travelling public's interest that he and that authority foster the companies that are bearing the burden of the cost of modernisation and providing the services.
	The problems, if that does not happen, are amply demonstrated by the slump, referred to many times during the debate, in Railtrack's stock market position. To some extent, that will have been brought about by loss of investor confidence partly as a result of the opprobrium that has been heaped on its head from a variety of areas. Rather than undermining it further, the Government's priority should be to begin the process of restoring the self-confidence of the railway operators' management. The fact that Railtrack is sliding down the FTSE is of no benefit to anyone. The Government's urgent task should be to encourage it to focus on its role as an efficient network operator.
	Apart from hard words, the Government have done little to date to dismantle or to reverse the privatised rail service. Even their oft announced rail modernisation fund of £7 million is designed to lever in greater amounts of private capital to enable the Strategic Rail Authority to engage in a long-term investment programme and to maximise the industry's ability to raise private capital.
	In general, life moves on. Britain has progressed a long way from the disastrous days of a nationalised rail service, but progress and development is a continuous process. The absolute certainty is that even this Government are now unlikely to go backwards, although too much centralisation and external control could undermine the ability of privatisation to do its job.
	However, the main attention of the debate has been concentrated on Railtrack. If managers do not manage and companies do not perform, that must be dealt with either by the board or by the more senior managers. The future of Railtrack and its ability to deal with what it has set out to do is truly in their hands. No organisation stands still. Ideas change as time moves on. Circumstances bring about change, and organisations need to adapt to those different situations.
	I do not believe that anyone in this Chamber would say that the services are perfect or, at the moment, satisfactory. But apart from the noble Lord, Lord Beaumont of Whitley, I have heard no one suggest that renationalisation will improve the situation. What is required is to ensure that the operation and services are increasingly attractive to the private sector and decreasingly of day-by-day interest to Ministers.

Lord Macdonald of Tradeston: My Lords, this has been an interesting and informative debate. I am grateful to the noble Lord, Lord Beaumont, who spoke with obvious conviction. I thank other noble Lords for their equally well informed contributions. I also welcome the noble Baroness, Lady Hanham, to her short intrusion into transport.
	I recognise the concerns so clearly articulated in the debate. It is unlikely that I shall be able to cover them all but any I fail to address I shall deal with in writing. We have achieved some progress since 1997 in some areas of the rail industry, but I agree that there is a great deal more to do. I shall set out how the Government will deliver that further growth and improved performance.
	As the noble Lord, Lord Wallace of Saltaire, mentioned, there is a problem of growth. In some sense, it is a more positive challenge than the management of decline, which was the fate of many previous governments. One million more people go to work now than in 1997, which accounts for part of the pressure on our transport system.
	Since Hatfield, several options for restructuring the management and operation of the national rail network have been put forward, particularly in relation to the future ownership of Railtrack. Indeed, last week the Transport Select Committee asked the Government to consider options which included taking Railtrack wholly back into public ownership.
	I join the noble Baroness, Lady Thomas of Walliswood, in seeing difficulties with renationalisation. To do so would probably take a couple of years and involve potentially complex and controversial primary legislation, during which time the industry would be effectively paralysed. The initial cost to taxpayers would comprise not only Railtrack's market capitalisation of around £2.5 billion--in passing, I noticed that today its stock has risen by 5 per cent--but in recent times the market has sent its own harsh message to the board and the management of Railtrack. The taxpayers would also be expected to pick up the £4 billion of debt liabilities. None of that would buy additional rail investment; it would all go towards compensating shareholders and funding the company's debt.
	Renationalisation would also involve the public sector in directly funding Railtrack investment into the future. The additional debt which the company currently plans to raise to finance its activities would become public sector borrowing.
	I share the conviction of noble Lords that mistakes were made in the privatisation process. However, I accept that there have been some advantages of innovation and investment since privatisation. Since Hatfield, the Conservative architects of that process have admitted that they got it wrong. But after years of fragmentation and instability, surely the answer is not more upheaval. What we need now is evolution rather than revolution. In saying that, I echo the views of Sir Alistair Morton, chairman of the Strategic Rail Authority. His views are apparently at odds with those of the noble Lord, Lord Bradshaw, whose contribution to the Strategic Rail Authority is much appreciated by government, despite his occasionally different approach.
	The Government believe that the major change advocated today to Railtrack's ownership, operation and accountability is not necessary to ensure that the company meets its public service obligations. We have, as was stressed by the noble Lord, Lord Faulkner, a rigorous and vigilant Rail Regulator to ensure that Railtrack delivers on its licence requirements and does not abuse its monopoly position.
	The noble Lord, Lord Bradshaw, said that the regulator might be merged with the SRA, but their roles are different and their jurisdictions do not overlap. The regulator is independent of government while the Strategic Rail Authority is not. That independence was recently underscored by your Lordships in passing the Transport Act 2000. That independence exists in other regulated industries.
	The noble Baroness, Lady Thomas of Walliswood, outlined some of the Liberal Democrat alternatives; for instance, a sustainable transport authority. I hope that she will forgive me if I do not go into a retrospective analysis of that. In February this year, the Prime Minister made it clear that in order to cure the problems on our railways we look to some of the alternatives supported by the Transport Act 2000. We need proper strategic control; we urgently need more investment; we have created the Strategic Rail Authority to tackle fragmentation and provide strategic leadership; and we are working hard to correct decades of under-investment through our 10-year plan for transport, published last July.
	As the noble Lord, Lord Greaves, said, like him, the Government want stability. Where there has been so much upheaval we look for coherence and we look for growth where there has been decline. When the noble Lord was reading Thomas the Tank Engine I was probably trainspotting at Glasgow Central. I am delighted to say that this year as many people are travelling on the railways as were travelling in 1947 when I first put on my 1940s equivalent of an anorak.
	The Government's interest is to ensure that Railtrack implements the national track recovery plan it promised following the disruption from gauge corner cracking and invests in a safer, more punctual and efficient railway. That is backed by our massive £60 billion programme in our 10-year plan. Therefore, the Government are creating the framework to deliver the bigger and better railway. We are doing that, first, by establishing the correct incentive structure and funding arrangements for the industry and, secondly, by providing the right tools and powers to enable its key players to work together effectively to rebuild public confidence in its ability to deliver a safe quality service.
	The Government's priorities, like those of many noble Lords here today, are more investment and better management and firm but fair regulation allied to a clear, consistent strategy for that rail renaissance which we all want. In return for our enhanced public subsidies, we demand value for money for the travelling public.
	Passengers are at the heart of our policies and they have not been getting the quality of journeys they deserve. The noble Lord, Lord Greaves, mentioned today's regrettable announcement by Virgin Trains that it will increase some unregulated fares by almost 10 per cent. Although train operators are free to increase unregulated fares, coming on top of the network problems following Hatfield it is a bitter pill for passengers to swallow. Surely it is not the way to attract passengers back to the railways.
	The Government look to the SRA to take the lead on these matters. Today I discussed the situation with its chief executive, Mike Grant. As a result, I hope that as a matter of urgency he will be talking to Virgin Trains and asking it to explain itself.
	That apart, we expect that the overall situation will continue to improve. That is the point of the 10-year plan, which is primed to start this month, and our role in driving forward the rail recovery programme. Through new legislation, new forms and enhanced levels of investment, and new franchise agreements, the Government are establishing a true public and private partnership working to shared national objectives.
	Earlier this week, the Deputy Prime Minister announced a new relationship between the Government and Railtrack. That will enable Railtrack to concentrate on sustaining the existing network and improving its asset stewardship while allowing others to participate in the financing and management of new schemes to expand capacity. The Channel Tunnel rail link, which is on budget and on schedule, is a good example of how such projects could work with external finance, strong management and operational involvement by Railtrack at no extra cost to the taxpayers.
	The new pact paves the way for bringing in third-party finance and project delivery skills to supplement Railtrack, starting with the priority major enhancement projects. It will enable the Strategic Rail Authority to create a new project finance and delivery vehicle for the East Coast Main Line and valuable new passenger and freight capacity on that key route. I assure the noble Baroness, Lady Thomas of Walliswood, that we value as highly as she does the need to demonstrate value for money. Through the public/private partnerships we believe that we can set targets and transfer risks on to private sector partners.
	This week also witnessed the agreement between the Government and Railtrack on the rephasing of £1.5 billion of grants due to the company under the Rail Regulator's periodic review of its access charges. That will ease Railtrack's current financial problems. There is no new money here since the company has already accepted that the immediate costs arising from Hatfield and the subsequent network disruption must be borne by shareholders. In those deals there will be some comfort for my noble friend Lord Woolmer of Leeds who asked about the contractual arrangements in relation to maintenance. Those will be longer term and certainly better integrated into the supply chain management, which the industry appears to have dismantled in recent times. There will be a strengthening of the engineering presence not only on the board but at senior management level, and there will also be a public interest director appointed in consultation with government.
	The SRA's refranchising programme has also taken a major step forward this week with the announcement of the preferred bidder for the new South West Trains franchise and the agreement with Chiltern--ahead of finalising the replacement franchise--of new trains and services, with tougher incentives for performance and customer satisfaction. As part of that agreement, the Government have undertaken to make up the difference between the level of access income from freight assumed in the regulator's October determination of passenger access charges and the final outcome of his review of freight charges, which my noble friend Lord Berkeley welcomed earlier. Today, Tom Winsor has published his provisional conclusions on freight charges. He proposes a halving of what Railfreight paid to Railtrack last year. The figure will be reduced to £82 million compared with £162 million at present.
	The document offers the industry a framework for long-term stability of freight access charges which will promote strong and sustainable growth in rail freight. Together with the SRA, we shall study those proposals very carefully. I also join my noble friend Lord Berkeley in welcoming the fact that we have put in place a framework for the industry to enable all its key players to work together to deliver the 10-year plan which promises 50 per cent passenger growth and 80 per cent freight growth.
	We are investing in the Government's vision of a national railway in which today's highest standards become the norm. The Government believe that their focus on safety, incentives, performance and delivery will ensure that the industry is run in the public interest as part of an integrated transport system. Obviously, the Government will try to enable the partnership, strategy and, above all, the investment to complete the job that they have begun. This week's general statement of principles between government and Railtrack marks a further stage in taking that forward.
	Prior to Hatfield the railways had their best opportunity in over 50 years to change and grow. Our announcements this week show that that opportunity has not gone away. Our long-term goal remains to make the most of it through the 10-year plan.

House adjourned at twenty-six minutes before eight o'clock.